10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________________________ 

FORM 10-Q

(Mark One)

þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2014

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 1-12387

TENNECO INC.

(Exact name of registrant as specified in its charter)

Delaware	76-0515284
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
500 North Field Drive, Lake Forest, Illinois	60045
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (847) 482-5000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.  Yes  þ      No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes  þ      No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer  þ	Accelerated filer  ¨	Non-accelerated filer  ¨	Smaller reporting company  ¨
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  ¨      No  þ

Indicate the number of shares outstanding of each of the issuer’s classes of common stock as of the latest practicable date.

Common Stock, par value $0.01 per share: 60,881,474 shares outstanding as of May 2, 2014.

TABLE OF CONTENTS

		Page
Part I — Financial Information
Item 1.	Financial Statements (Unaudited)	5
	Tenneco Inc. and Consolidated Subsidiaries —
	Report of Independent Registered Public Accounting Firm	5
	Condensed Consolidated Statements of Income	6
	Condensed Consolidated Statements of Comprehensive Income	7
	Condensed Consolidated Balance Sheets	9
	Condensed Consolidated Statements of Cash Flows	10
	Condensed Consolidated Statements of Changes in Shareholders’ Equity	11
	Notes to Condensed Consolidated Financial Statements	12
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	48
Item 4.	Controls and Procedures	49
Part II — Other Information
Item 1.	Legal Proceedings	*
Item 1A.	Risk Factors	50
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	50
Item 3.	Defaults Upon Senior Securities	*
Item 4.	Mine Safety Disclosures	*
Item 5.	Other Information	*
Item 6.	Exhibits	52

* No response to this item is included herein for the reason that it is inapplicable or the answer to such item is negative.

2

CAUTIONARY STATEMENT FOR PURPOSES OF THE “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

This Quarterly Report contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 concerning, among other things, our prospects and business strategies. These forward-looking statements are included in various sections of this report, including the section entitled “Outlook” appearing in Item 2 of this report. The words “may,” “will,” “believe,” “should,” “could,” “plan,” “expect,” “anticipate,” “estimate,” and similar expressions (and variations thereof), identify these forward-looking statements. Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, these expectations may not prove to be correct. Because these forward-looking statements are also subject to risks and uncertainties, actual results may differ materially from the expectations expressed in the forward-looking statements. Important factors that could cause actual results to differ materially from the expectations reflected in the forward-looking statements include:

• general economic, business and market conditions;

• our ability to source and procure needed materials, components and other products and services in accordance with customer demand and at competitive prices;

• the cost and outcome of existing and any future claims, legal proceedings or investigations, including, but not limited to, any of the foregoing arising in connection with the ongoing global antitrust investigation, product performance, product safety or intellectual property rights;

• changes in capital availability or costs, including increases in our cost of borrowing (i.e., interest rate increases), the amount of our debt, our ability to access capital markets at favorable rates, and the credit ratings of our debt;

• changes in consumer demand, prices and our ability to have our products included on top selling vehicles, including any shifts in consumer preferences away from light trucks, which tend to be higher margin products for our customers and us, to other lower margin vehicles, for which we may or may not have supply arrangements;

• changes in consumer demand for our automotive, commercial or aftermarket products, or changes in automotive and commercial vehicle manufacturers’ production rates and their actual and forecasted requirements for our products, due to difficult economic conditions, such as the prolonged recession in Europe;

• the overall highly competitive nature of the automobile and commercial vehicle parts industries, and any resultant inability to realize the sales represented by our awarded book of business (which is based on anticipated pricing and volumes over the life of the applicable program);

• the loss of any of our large original equipment manufacturer (“OEM”) customers (on whom we depend for a substantial portion of our revenues), or the loss of market shares by these customers if we are unable to achieve increased sales to other OEMs or any change in customer demand due to delays in the adoption or enforcement of worldwide emissions regulations;

• our ability to successfully execute cash management and other cost reduction plans, including our current European cost reduction initiatives, and to realize anticipated benefits from these plans;

• industrywide strikes, labor disruptions at our facilities or any labor or other economic disruptions at any of our significant customers or suppliers or any of our customers’ other suppliers;

• increases in the costs of raw materials, including our ability to successfully reduce the impact of any such cost increases through materials substitutions, cost reduction initiatives, customer recovery and other methods;

• the negative impact of higher fuel prices on transportation and logistics costs, raw material costs and discretionary purchases of vehicles or aftermarket products;

• the cyclical nature of the global vehicle industry, including the performance of the global aftermarket sector and the impact of vehicle parts’ longer product lives;

• costs related to product warranties and other customer satisfaction actions;

• the failure or breach of our information technology systems, including the consequences of any misappropriation, exposure or corruption of sensitive information stored on such systems and the interruption to our business that such failure or breach may cause;

• the impact of consolidation among vehicle parts suppliers and customers on our ability to compete;

• changes in distribution channels or competitive conditions in the markets and countries where we operate, including the impact of changes in distribution channels for aftermarket products on our ability to increase or maintain aftermarket sales;

• economic, exchange rate and political conditions in the countries where we operate or sell our products;

• customer acceptance of new products;

• new technologies that reduce the demand for certain of our products or otherwise render them obsolete;

3

• our ability to introduce new products and technologies that satisfy customers' needs in a timely fashion;

• our ability to realize our business strategy of improving operating performance;

• our ability to successfully integrate any acquisitions that we complete and effectively manage our joint ventures and other third-party relationships;

• changes by the Financial Accounting Standards Board or the Securities and Exchange Commission of authoritative generally accepted accounting principles or policies;

• changes in accounting estimates and assumptions, including changes based on additional information;

• any changes by the International Organization for Standardization (ISO) or other such committees in their certification protocols for processes and products, which may have the effect of delaying or hindering our ability to bring new products to market;

• the impact of the extensive, increasing and changing laws and regulations to which we are subject, including environmental laws and regulations, which may result in our incurrence of environmental liabilities in excess of the amount reserved;

• the potential impairment in the carrying value of our long-lived assets and goodwill or our deferred tax assets;

• potential volatility in our effective tax rate;

• natural disasters, such as the 2011 earthquake in Japan and flooding in Thailand, and any resultant disruptions in the supply or production of goods or services to us or by us or in demand by our customers;

• acts of war and/or terrorism, as well as actions taken or to be taken by the United States and other governments as a result of further acts or threats of terrorism, and the impact of these acts on economic, financial and social conditions in the countries where we operate; and

• the timing and occurrence (or non-occurrence) of other transactions, events and circumstances which may be beyond our control.

The risks included here are not exhaustive. Refer to “Part I, Item 1A — Risk Factors” in our annual report on Form 10-K for the year ended December 31, 2013 and "Part II, Item 1A — Risk Factors” of this Form 10-Q for further discussion regarding our exposure to risks. Additionally, new risk factors emerge from time to time and it is not possible for us to predict all such risk factors, nor to assess the impact such risk factors might have on our business or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.

4

PART I.

FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS (UNAUDITED)

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Tenneco Inc.:

We have reviewed the accompanying condensed consolidated balance sheet of Tenneco Inc. and consolidated subsidiaries as of March 31, 2014, and the related condensed consolidated statements of income, comprehensive income, and cash flows and changes in shareholders' equity for the three month periods ended March 31, 2014 and 2013. These interim financial statements are the responsibility of the Company’s management.

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the accompanying condensed consolidated interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet as of December 31, 2013, and the related consolidated statements of income, comprehensive income, cash flows and changes in shareholders’ equity for the year then ended (not presented herein), and in our report dated February 27, 2014, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2013, is fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived.

/s/ PricewaterhouseCoopers LLP

Milwaukee, Wisconsin

May 6, 2014

The “Report of Independent Registered Public Accounting Firm” included above is not a “report” or “part of a Registration Statement” prepared or certified by an independent accountant within the meaning of Sections 7 and 11 of the Securities Act of 1933, and the accountants’ Section 11 liability does not extend to such report.

5

TENNECO INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended March 31, 2014			Three Months Ended March 31, 2013
	(Millions Except Share and Per Share Amounts)
Revenues
Net sales and operating revenues	$	2,094		$	1,903
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	1,754			1,604
Engineering, research, and development	42			35
Selling, general, and administrative	132			119
Depreciation and amortization of other intangibles	51			50
	1,979			1,808
Other expense
Loss on sale of receivables	(1		)	(1		)
Other	(1		)	(1		)
	(2		)	(2		)
Earnings before interest expense, income taxes, and noncontrolling interests	113			93
Interest expense (net of interest capitalized of $1 million for both three months ended March 31, 2014 and 2013, respectively)	19			20
Earnings before income taxes and noncontrolling interests	94			73
Income tax expense	40			12
Net income	54			61
Less: Net income attributable to noncontrolling interests	8			7
Net income attributable to Tenneco Inc.	$	46		$	54
Earnings per share
Weighted average shares of common stock outstanding —
Basic	60,549,778			60,288,997
Diluted	61,503,302			61,481,835
Basic earnings per share of common stock	$	0.76		$	0.90
Diluted earnings per share of common stock	$	0.75		$	0.88

The accompanying notes to the condensed consolidated financial statements are an integral

part of these condensed consolidated statements of income.

6

TENNECO INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	For the Three Months Ended March 31, 2014
	Tenneco Inc.						Noncontrolling Interests						Total
	Accumulated Other Comprehensive Income (Loss)			Comprehensive Income (Loss)			Accumulated Other Comprehensive Income (Loss)			Comprehensive Income (Loss)			Accumulated Other Comprehensive Income (Loss)			Comprehensive Income (Loss)
	(Millions)
Net Income				$	46					$	8					$	54
Accumulated Other Comprehensive Income (Loss)
Cumulative Translation Adjustment
Balance January 1	$	(61	)				$	5					$	(56	)
Translation of foreign currency statements	(6		)	(6		)	(2		)	(2		)	(8		)	(8		)
Balance March 31	(67		)				3						(64		)
Additional Liability for Pension and Postretirement Benefits
Balance January 1	(299		)				—						(299		)
Additional Liability for Pension and Postretirement Benefits, net of tax	3			3									3			3
Balance March 31	(296		)				—						(296		)
Balance March 31	$	(363	)				$	3					$	(360	)
Other Comprehensive Loss				(3		)				(2		)				(5		)
Comprehensive Income				$	43					$	6					$	49

The accompanying notes to the condensed consolidated financial statements are an integral

part of these condensed consolidated statements of comprehensive income.

7

TENNECO INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	For the Three Months Ended March 31, 2013
	Tenneco Inc.						Noncontrolling Interests				Total
	Accumulated Other Comprehensive Income (Loss)			Comprehensive Income (Loss)			Accumulated Other Comprehensive Income (Loss)		Comprehensive Income (Loss)		Accumulated Other Comprehensive Income (Loss)			Comprehensive Income (Loss)
	(Millions)
Net Income				$	54				$	7				$	61
Accumulated Other Comprehensive Income (Loss)
Cumulative Translation Adjustment
Balance January 1	$	(24	)				$	5			$	(19	)
Translation of foreign currency statements	(26		)	(26		)	—		—		(26		)	(26		)
Balance March 31	(50		)				5				(45		)
Additional Liability for Pension and Postretirement Benefits
Balance January 1	(384		)				—				(384		)
Additional Liability for Pension and Postretirement Benefits, net of tax	4			4							4			4
Balance March 31	(380		)				—				(380		)
Balance March 31	$	(430	)				$	5			$	(425	)
Other Comprehensive Loss				(22		)			—					(22		)
Comprehensive Income				$	32				$	7				$	39

The accompanying notes to the condensed consolidated financial statements are an integral

part of these condensed consolidated statements of comprehensive income.

8

TENNECO INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	March 31, 2014			December 31, 2013
	(Millions)
ASSETS
Current assets:
Cash and cash equivalents	$	267		$	275
Restricted cash	6			5
Receivables —
Customer notes and accounts, net	1,265			1,041
Other	23			19
Inventories —
Finished goods	295			267
Work in process	233			202
Raw materials	151			130
Materials and supplies	58			57
Deferred income taxes	71			71
Prepayments and other	259			223
Total current assets	2,628			2,290
Other assets:
Long-term receivables, net	14			14
Goodwill	69			69
Intangibles, net	29			30
Deferred income taxes	117			125
Other	128			127
	357			365
Plant, property, and equipment, at cost	3,545			3,498
Less — Accumulated depreciation and amortization	(2,351		)	(2,323		)
	1,194			1,175
Total Assets	$	4,179		$	3,830
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt (including current maturities of long-term debt)	$	106		$	83
Trade payables	1,430			1,359
Accrued taxes	44			40
Accrued interest	14			10
Accrued liabilities	265			252
Other	95			94
Total current liabilities	1,954			1,838
Long-term debt	1,209			1,019
Deferred income taxes	29			28
Postretirement benefits	235			249
Deferred credits and other liabilities	194			204
Commitments and contingencies
Total liabilities	3,621			3,338
Redeemable noncontrolling interests	25			20
Tenneco Inc. Shareholders’ equity:
Common stock	1			1
Premium on common stock and other capital surplus	3,029			3,014
Accumulated other comprehensive loss	(363		)	(360		)
Retained earnings (accumulated deficit)	(1,875		)	(1,921		)
	792			734
Less — Shares held as treasury stock, at cost	301			301
Total Tenneco Inc. shareholders’ equity	491			433
Noncontrolling interests	42			39
Total equity	533			472
Total liabilities, redeemable noncontrolling interests and equity	$	4,179		$	3,830

The accompanying notes to the condensed consolidated financial statements are an integral

part of these condensed consolidated balance sheets.

9

TENNECO INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three Months Ended March 31, 2014			Three Months Ended March 31, 2013
	(Millions)
Net income	$	54		$	61
Adjustments to reconcile net income to cash provided by operating activities —
Depreciation and amortization of other intangibles	51			50
Deferred income taxes	2			(5		)
Stock-based compensation	5			5
Loss on sale of assets	1			—
Changes in components of working capital —
(Increase) decrease in receivables	(234		)	(176		)
(Increase) decrease in inventories	(81		)	(40		)
(Increase) decrease in prepayments and other current assets	(38		)	(49		)
Increase (decrease) in payables	87			77
Increase (decrease) in accrued taxes	5			(5		)
Increase (decrease) in accrued interest	4			4
Increase (decrease) in other current liabilities	13			(8		)
Changes in long-term assets	1			—
Changes in long-term liabilities	(13		)	(10		)
Other	3			4
Net cash provided by operating activities	(140		)	(92		)
Investing Activities
Proceeds from the sale of assets	—			2
Cash payments for plant, property, and equipment	(83		)	(70		)
Cash payments for software related intangible assets	(7		)	(6		)
Changes in restricted cash	(1		)	(9		)
Net cash (used) by investing activities	(91		)	(83		)
Financing Activities
Issuance (repurchase) of common shares	(2		)	1
Tax benefit from stock-based compensation	12			—
Retirement of long-term debt	(3		)	(5		)
Increase (decrease) in bank overdrafts	4			(9		)
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable	197			191
Net increase in short-term borrowings secured by accounts receivable	20			—
Capital contribution from noncontrolling interest partner	1			—
Net cash provided (used) by financing activities	229			178
Effect of foreign exchange rate changes on cash and cash equivalents	(6		)	7
Increase (decrease) in cash and cash equivalents	(8		)	10
Cash and cash equivalents, January 1	275			223
Cash and cash equivalents, March 31 (Note)	$	267		$	233
Supplemental Cash Flow Information
Cash paid during the period for interest	$	14		$	16
Cash paid during the period for income taxes (net of refunds)	21			25
Non-cash Investing and Financing Activities
Period end balance of trade payables for plant, property, and equipment	$	40		$	31

Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase.

The accompanying notes to the condensed consolidated financial statements are an integral

part of these condensed consolidated statements of cash flows.

10

TENNECO INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited)

	Three Months Ended March 31,
	2014				2013
	Shares	Amount			Shares	Amount
	(Millions Except Share Amounts)
Tenneco Inc. Shareholders:
Common Stock
Balance January 1	63,714,728	$	1		62,789,382	$	1
Issued pursuant to benefit plans	82,743	—			160,827	—
Stock options exercised	25,595	—			97,622	—
Balance March 31	63,823,066	1			63,047,831	1
Premium on Common Stock and Other Capital Surplus
Balance January 1		3,014				3,031
Premium on common stock issued pursuant to benefit plans		15				6
Balance March 31		3,029				3,037
Accumulated Other Comprehensive Loss
Balance January 1		(360		)		(408		)
Other comprehensive income (loss)		(3		)		(22		)
Balance March 31		(363		)		(430		)
Retained Earnings (Accumulated Deficit)
Balance January 1		(1,921		)		(2,104		)
Net income attributable to Tenneco Inc.		46				54
Balance March 31		(1,875		)		(2,050		)
Less — Common Stock Held as Treasury Stock, at Cost
Balance January 1	2,844,692	301			2,294,692	274
Purchase of common stock through stock repurchase program	—	—			—	—
Balance March 31	2,844,692	301			2,294,692	274
Total Tenneco Inc. shareholders’ equity		$	491			$	284
Noncontrolling Interests:
Balance January 1		$	39			$	45
Net income		4				5
Other comprehensive income (loss)		(1		)		—
Balance March 31		$	42			$	50
Total equity		$	533			$	334

The accompanying notes to the condensed consolidated financial statements are an integral

part of these condensed consolidated statements of changes in shareholders’ equity.

11

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(1) Consolidation and Presentation

As you read the accompanying financial statements you should also read our Annual Report on Form 10-K for the year ended December 31, 2013.

In our opinion, the accompanying unaudited financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly Tenneco Inc.’s results of operations, comprehensive income, financial position, cash flows, and changes in shareholders’ equity for the periods indicated. We have prepared the unaudited condensed consolidated financial statements pursuant to the rules and regulations of the U.S. Securities and Exchange Commission for interim financial information. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (U.S. GAAP) for annual financial statements.

Our condensed consolidated financial statements include all majority-owned subsidiaries. We carry investments in 20 percent to 50 percent owned companies in which the Company does not have a controlling interest, as equity method investments, at cost plus equity in undistributed earnings since the date of acquisition and cumulative translation adjustments. We have eliminated all intercompany transactions. We have evaluated all significant subsequent events for any impact on these financial statements through the date they were issued.

(2) Financial Instruments

The carrying and estimated fair values of our financial instruments by class at March 31, 2014 and December 31, 2013 were as follows:

	March 31, 2014				December 31, 2013
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(Millions)
Long-term debt (including current maturities)	$	1,211	$	1,275	$	1,021	$	1,089
Instruments with off-balance sheet risk:
Foreign exchange forward contracts:
Asset derivative contracts	1		1		—		—

Asset and Liability Instruments — The fair value of cash and cash equivalents, short and long-term receivables, accounts payable, and short-term debt was considered to be the same as or was not determined to be materially different from the carrying amount.

Long-term Debt — The fair value of our public fixed rate senior notes is based on quoted market prices (level 1). The fair value of our private borrowings under our senior credit facility and other long-term debt instruments is based on the market value of debt with similar maturities, interest rates and risk characteristics (level 2). The fair value of our level 1 debt, as classified in the fair value hierarchy, was $789 million and $790 million at March 31, 2014 and December 31, 2013, respectively. We have classified $477 million and $287 million as level 2 in the fair value hierarchy at March 31, 2014 and December 31, 2013, respectively, since we utilize valuation inputs that are observable both directly and indirectly. We classified the remaining $9 million and $10 million, consisting of foreign subsidiary debt, as level 3 in the fair value hierarchy at March 31, 2014 and December 31, 2013, respectively.

Foreign Exchange Forward Contracts — We use derivative financial instruments, principally foreign currency forward purchase and sales contracts with terms of less than one year, to hedge our exposure to changes in foreign currency exchange rates. Our primary exposure to changes in foreign currency rates results from intercompany loans made between affiliates to minimize the need for borrowings from third parties. Additionally, we enter into foreign currency forward purchase and sale contracts to mitigate our exposure to changes in exchange rates on certain intercompany and third-party trade receivables and payables. We manage counter-party credit risk by entering into derivative financial instruments with major financial institutions that can be expected to fully perform under the terms of such agreements. We do not enter into derivative financial instruments for speculative purposes. The fair value of our foreign currency forward contracts is based on an internally developed model which incorporates observable inputs including quoted spot rates, forward exchange rates and discounted future expected cash flows utilizing market interest rates with similar quality and maturity characteristics. We record the change in fair value of these foreign exchange forward contracts as part of currency gains (losses) within cost of sales in the condensed consolidated statements of income. The fair value of foreign exchange forward contracts are recorded in prepayments and other current assets or other current liabilities in the condensed consolidated balance sheet. The fair value of our foreign exchange forward contracts, presented on a gross basis at March 31, 2014 and December 31, 2013, respectively, was as follows:

12

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

Fair Value of Derivative Instruments

March 31, 2014

December 31, 2013

Asset Derivatives

Liability Derivatives

Total

Asset Derivatives

Liability Derivatives

Total

(Millions)

Foreign exchange forward contracts

$1

$—

$1

$

—

$—

$—

The fair value of our recurring financial assets at March 31, 2014 and December 31, 2013, respectively, are as follows:

	March 31, 2014				December 31, 2013
	Level 1	Level 2		Level 3	Level 1	Level 2		Level 3
	(Millions)
Financial Assets:
Foreign exchange forward contracts	n/a	$	1	n/a	n/a	$	—	n/a

The fair value hierarchy definition prioritizes the inputs used in measuring fair value into the following levels:

Level 1	—	Quoted prices in active markets for identical assets or liabilities.
Level 2	—	Inputs, other than quoted prices in active markets, that are observable either directly or indirectly.
Level 3	—	Unobservable inputs based on our own assumptions.

The following table summarizes by major currency the notional amounts for foreign currency forward purchase and sale contracts as of March 31, 2014 (all of which mature in 2014):

		Notional Amount in Foreign Currency
		(Millions)
Australian dollars	—Purchase	2
British pounds	—Purchase	31
	—Sell	(5	)
Canadian dollars	—Purchase	12
	—Sell	(2	)
European euro	—Purchase	8
	—Sell	(15	)
South African rand	—Purchase	222
Japanese yen	—Purchase	196
	—Sell	(461	)
Polish zloty	—Purchase	21
U.S. dollars	—Purchase	16
	—Sell	(84	)

Guarantees —We have from time to time issued guarantees for the performance of obligations by some of our subsidiaries, and some of our subsidiaries have guaranteed our debt. All of our existing and future material domestic wholly-owned subsidiaries fully and unconditionally guarantee our senior credit facility and our senior notes on a joint and several basis. The arrangement for the senior credit facility is also secured by first-priority liens on substantially all our domestic assets and pledges of up to 66 percent of the stock of certain first-tier foreign subsidiaries. No assets or capital stock of our direct or indirect subsidiaries secure our senior notes. For additional information, refer to Note 13 of our condensed consolidated financial statements, where we present the Supplemental Guarantor Condensed Consolidating Financial Statements.

We have two performance guarantee agreements in the U.K. between Tenneco Management Europe Limited (“TMEL”) and the two Walker Group Retirement Plans, the Walker Group Employee Benefit Plan and the Walker Group Executive Retirement Benefit Plan (the “Walker Plans”), whereby TMEL will guarantee the payment of all current and future pension

13

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

contributions in event of a payment default by the sponsoring or participating employers of the Walker Plans. As a result of our decision to enter into these performance guarantee agreements, the levy due to the U.K. Pension Protection Fund was reduced. The Walker Plans are comprised of employees from Tenneco Walker (U.K.) Limited and our Futaba-Tenneco U.K. joint venture. Employer contributions are funded by both Tenneco Walker (U.K.) Limited, as the sponsoring employer and Futaba-Tenneco U.K., as a participating employer. The performance guarantee agreements are expected to remain in effect until all pension obligations for the Walker Plans’ sponsoring and participating employers have been satisfied. The maximum amount payable for these pension performance guarantees is approximately $32 million as of March 31, 2014 which is determined by taking 105 percent of the liability of the Walker Plans calculated under section 179 of the U.K. Pension Act of 2004 offset by plan assets. We did not record an additional liability for this performance guarantee since Tenneco Walker (U.K.) Limited, as the sponsoring employer of the Walker Plans, already recognizes 100 percent of the pension obligation calculated based on U.S. GAAP, for all of the Walker Plans’ participating employers on its balance sheet, which was $9 million and $10 million at March 31, 2014 and December 31, 2013, respectively. At March 31, 2014, all pension contributions under the Walker Plans were current for all of the Walker Plans’ sponsoring and participating employers.

In June 2011, we entered into an indemnity agreement between TMEL and Futaba Industrial Co. Ltd. which requires Futaba to indemnify TMEL for any cost, loss or liability which TMEL may incur under the performance guarantee agreements relating to the Futaba-Tenneco U.K. joint venture. The maximum amount reimbursable by Futaba to TMEL under this indemnity agreement is equal to the amount incurred by TMEL under the performance guarantee agreements multiplied by Futaba’s shareholder ownership percentage of the Futaba-Tenneco U.K. joint venture. At March 31, 2014, the maximum amount reimbursable by Futaba to TMEL is approximately $6 million.

We have issued guarantees through letters of credit in connection with some obligations of our affiliates. As of March 31, 2014, we have guaranteed $38 million in letters of credit to support some of our subsidiaries’ insurance arrangements, foreign employee benefit programs, environmental remediation activities and cash management and capital requirements.

Negotiable Financial Instruments — One of our European subsidiaries receives payment from one of its customers whereby the accounts receivable are satisfied through the delivery of negotiable financial instruments. We may collect these financial instruments before their maturity date by either selling them at a discount or using them to satisfy accounts receivable that have previously been sold to a European bank. Any of these financial instruments which are not sold are classified as other current assets. The amount of these financial instruments that was collected before their maturity date and sold at a discount totaled $6 million and $5 million at March 31, 2014 and December 31, 2013, respectively. No negotiable financial instruments were held by our European subsidiary as of March 31, 2014 or December 31, 2013.

In certain instances, several of our Chinese subsidiaries receive payments from customers and satisfy vendor payments through the receipt and delivery of negotiable financial instruments. Financial instruments issued to satisfy vendor payables and not redeemed totaled $21 million and $13 million at March 31, 2014 and December 31, 2013, respectively, and were classified as notes payable. Financial instruments received from customers and not redeemed totaled $20 million and $12 million at March 31, 2014 and December 31, 2013, respectively. We classify financial instruments received from our customers as other current assets if issued by a financial institution of our customers or as customer notes and accounts, net if issued by our customer. We classified $20 million and $12 million in other current assets at March 31, 2014 and December 31, 2013, respectively. Some of our Chinese subsidiaries that issue their own negotiable financial instruments to pay vendors are required to maintain a cash balance if they exceed certain credit limits with the financial institution that guarantees those financial instruments. A restricted cash balance was required at those Chinese subsidiaries at March 31, 2014 for less than $1 million and was not required at December 31, 2013.

The negotiable financial instruments received by one of our European subsidiaries and some of our Chinese subsidiaries are checks drawn by our customers and guaranteed by their banks that are payable at a future date. The use of these instruments for payment follows local commercial practice. Because negotiable financial instruments are financial obligations of our customers and are guaranteed by our customers’ banks, we believe they represent a lower financial risk than the outstanding accounts receivable that they satisfy which are not guaranteed by a bank.

Supply Chain Financing — Near the end of the second quarter of 2013 certain of our suppliers in the U.S. extended their payment terms to Tenneco. The liquidity benefit to Tenneco from the extended payment terms totaled $11 million at March 31, 2014. These suppliers also began participating in a supply chain financing program under which they securitize their accounts receivables from Tenneco with two financial institutions. The financial institutions participate in the supply chain financing program on an uncommitted basis and can cease purchasing receivables from Tenneco's suppliers at any time. If the financial institutions did not continue to purchase receivables from Tenneco's suppliers under this program, the participating vendors could reduce their payment terms to Tenneco which in turn would cause our borrowings under our revolving credit facility to increase.

14

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

Restricted Cash - Two of our Australian subsidiaries arranged for $5 million in guarantees to be issued by a financial institution to support some of our subsidiaries' property lease arrangements and workers compensation programs. These guarantees were supported by a cash deposit with the financial institution which has been classified as restricted cash on the Tenneco Inc. consolidated balance sheet at March 31, 2014.

Some of our Chinese subsidiaries are required to maintain a cash balance if they exceed certain credit limits with the financial institution that guarantees the negotiable financial instruments issued by Tenneco to pay vendors. At the end of the first quarter of 2014, one of our Chinese subsidiaries exceeded their credit limits and was required to maintain a cash balance. The cash balance required was less than $1 million which has been classified as restricted cash on the Tenneco Inc. consolidated balance sheet at March 31, 2014.

(3) Long-Term Debt and Financing Arrangements

Our financing arrangements are primarily provided by a committed senior secured financing arrangement with a syndicate of banks and other financial institutions. The arrangement is secured by substantially all our domestic assets and pledges of up to 66 percent of the stock of certain first-tier foreign subsidiaries, as well as guarantees by our material domestic subsidiaries.

On March 22, 2012, we completed an amendment and restatement of our senior credit facility by increasing the amount and extending the maturity date of our revolving credit facility and adding a new $250 million Tranche A Term Facility. As of March 31, 2014, the senior credit facility provides us with a total revolving credit facility size of $850 million and had a $225 million balance outstanding under the Tranche A Term Facility, both of which will mature on March 22, 2017. Funds may be borrowed, repaid and re-borrowed under the revolving credit facility without premium or penalty. The revolving credit facility is reflected as debt on our balance sheet only if we borrow money under this facility or if we use the facility to make payments for letters of credit. Outstanding letters of credit reduce our availability to enter into revolving loans under the facility. We are required to make quarterly principal payments under the Tranche A Term Facility of $6.3 million beginning June 30, 2014 through March 31, 2015, $9.4 million beginning June 30, 2015 through March 31, 2016, $12.5 million beginning June 30, 2016 through December 31, 2016 and a final payment of $125 million is due on March 22, 2017. We have excluded the required payments, within the next twelve months, under the Tranche A Term Facility totaling $25 million from current liabilities as of March 31, 2014, because we have the intent and ability to refinance the obligations on a long-term basis by using our revolving credit facility.

The financial ratios required under the amended and restated senior credit facility, and the actual ratios we achieved for the first quarter of 2014, are as follows:

	Quarter Ended
	March 31, 2014
	Required	Actual
Leverage Ratio (maximum)	3.50	1.63
Interest Coverage Ratio (minimum)	2.75	10.39

The senior credit facility includes a maximum leverage ratio covenant of 3.50 and a minimum interest coverage ratio of 2.75 through March 22, 2017.

At March 31, 2014, of the $850 million available under the revolving credit facility, we had unused borrowing capacity of $562 million with $251 million in outstanding borrowings and $37 million in outstanding letters of credit. As of March 31, 2014, our outstanding debt also included $225 million related to our Tranche A Term Facility which is subject to quarterly principal payments as described above through March 22, 2017, $225 million of 7.75 percent senior notes due August 15, 2018, $500 million of 6.875 percent senior notes due December 15, 2020, and $114 million of other debt.

(4) Income Taxes

For interim tax reporting we estimate our annual effective tax rate and apply it to our year to date ordinary income. Jurisdictions with a projected loss for the year or an actual year-to-date loss where no tax benefit can be recognized due to a valuation allowance are excluded from the estimated annual effective tax rate. The impact of including these jurisdictions on the quarterly effective rate calculation could result in a higher or lower effective tax rate during a particular quarter due to the mix and timing of actual earnings versus annual projections. The tax effects of certain unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are excluded from the estimated annual effective tax rate calculation and recognized in the interim period in which they occur.

15

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

We reported income tax expense of $40 million and $12 million in the three month periods ended March 31, 2014 and 2013, respectively. The tax expense recorded in the first three months of 2013 included a net tax benefit of $13 million for tax adjustments primarily related to recognizing a U.S. tax benefit for foreign taxes and changes to prior year estimates. U.S. tax benefit for foreign taxes is driven by our ability to claim a U.S. foreign tax credit beginning in 2013. The U.S. foreign tax credit law provides for a credit against U.S. taxes otherwise payable for foreign taxes paid with regard to dividends, interest and royalties paid to us in the U.S.

In 2012, we reversed the tax valuation allowance against our net deferred tax assets in the U.S. based on operating improvements we had made, the outlook for light and commercial vehicle production in the U.S. and the positive impact this should have on our U.S. operations. We now have a federal net operating loss ("NOL") at March 31, 2014 of $5 million, which expires in 2030. The state NOLs expire in various tax years through 2032.

Valuation allowances are established in certain foreign jurisdictions for deferred tax assets based on a “more likely than not” standard. The ability to realize deferred tax assets depends on our ability to generate sufficient taxable income within the carryforward periods provided for in the tax law for each tax jurisdiction. We have considered the following possible sources of taxable income when assessing the realization of our deferred tax assets:

• Future reversals of existing taxable temporary differences;

• Taxable income or loss, based on recent results, exclusive of reversing temporary differences and carryforwards;

• Tax-planning strategies; and

• Taxable income in prior carryback years if carryback is permitted under the relevant tax law.

The valuation allowances recorded against deferred tax assets will impact our provision for income taxes until the valuation allowances are released. Our provision for income taxes will include no tax benefit for losses incurred and no tax expense with respect to income generated in these jurisdictions until the respective valuation allowance is eliminated.

(5) Accounts Receivable Securitization

We securitize some of our accounts receivable on a limited recourse basis in North America and Europe. As servicer under these accounts receivable securitization programs, we are responsible for performing all accounts receivable administration functions for these securitized financial assets including collections and processing of customer invoice adjustments. In North America, we have an accounts receivable securitization program with three commercial banks comprised of a first priority facility and a second priority facility. We securitize original equipment and aftermarket receivables on a daily basis under the bank program. In March 2014, the North American program was amended and extended to March 20, 2015. The first priority facility continues to provide financing of up to $110 million and the second priority facility, which is subordinated to the first priority facility, continues to provide up to an additional $40 million of financing. Both facilities monetize accounts receivable generated in the U.S. and Canada that meet certain eligibility requirements, and the second priority facility also monetizes certain accounts receivable generated in the U.S. and Canada that would otherwise be ineligible under the first priority securitization facility. The amount of outstanding third-party investments in our securitized accounts receivable under the North American program was $30 million at March 31, 2014 and $10 million at December 31, 2013.

Each facility contains customary covenants for financings of this type, including restrictions related to liens, payments, mergers or consolidations and amendments to the agreements underlying the receivables pool. Further, each facility may be terminated upon the occurrence of customary events (with customary grace periods, if applicable), including breaches of covenants, failure to maintain certain financial ratios, inaccuracies of representations and warranties, bankruptcy and insolvency events, certain changes in the rate of default or delinquency of the receivables, a change of control and the entry or other enforcement of material judgments. In addition, each facility contains cross-default provisions, where the facility could be terminated in the event of non-payment of other material indebtedness when due and any other event which permits the acceleration of the maturity of material indebtedness.

We also securitize receivables in our European operations with regional banks in Europe under various separate facilities. The commitments for these arrangements are generally for one year, but some may be canceled with notice 90 days prior to renewal. In some instances, the arrangement provides for cancellation by the applicable financial institution at any time upon 15 days, or less, notification. The amount of outstanding third-party investments in our securitized accounts receivable in Europe was $175 million and $134 million at March 31, 2014 and December 31, 2013, respectively.

If we were not able to securitize receivables under either the North American or European securitization programs, our borrowings under our revolving credit agreement might increase. These accounts receivable securitization programs provide us with access to cash at costs that are generally favorable to alternative sources of financing, and allow us to reduce borrowings under our revolving credit agreement.

16

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

In our North American accounts receivable securitization programs, we transfer a partial interest in a pool of receivables and the interest that we retain is subordinate to the transferred interest. Accordingly, we account for our North American securitization program as a secured borrowing. In our European programs, we transfer accounts receivables in their entirety to the acquiring entities and satisfy all of the conditions established under Accounting Standards Codification (ASC) Topic 860, “Transfers and Servicing,” to report the transfer of financial assets in their entirety as a sale. The proceeds received in exchange for the transfer of accounts receivable under our European securitization programs approximates the fair value of such receivables. We recognized less than $1 million interest expense in each of the three month periods ended March 31, 2014 and 2013 relating to our North American securitization program. In addition, we recognized a loss of $1 million in each of the three month periods ended March 31, 2014 and 2013 on the sale of trade accounts receivable in our European accounts receivable securitization programs, representing the discount from book values at which these receivables were sold to our banks. The discount rate varies based on funding costs incurred by our banks, which averaged approximately three percent during both the first three months of 2014 and 2013, respectively.

(6) Restructuring and Other Charges

Over the past several years, we have adopted plans to restructure portions of our operations. These plans were approved by our Board of Directors and were designed to reduce operational and administrative overhead costs throughout the business. In 2013, we incurred $78 million in restructuring and related costs, primarily related to European cost reduction efforts including non-cash asset write downs of $3 million, our exit from the distribution of aftermarket exhaust products and ending production of leaf springs in Australia, headcount reductions in various regions and the net impact of freezing our defined benefits plans in the United Kingdom, of which $70 million was recorded in cost of sales and $6 million was recorded in SG&A, $1 million in engineering expense and $1 million in other expense. In the first quarter of 2014, we incurred $10 million in restructuring and related costs, primarily related to European cost reduction efforts including non-cash asset write downs of $1 million, all of which was recorded in cost of sales. During the first quarter of 2013, we incurred $4 million in restructuring and related costs, primarily related to European cost reduction efforts and the costs to exit the distribution of aftermarket exhaust products in Australia, of which $3 million was recorded in cost of sales and $1 million was recorded in SG&A.

Amounts related to activities that are part of our restructuring reserves are as follows:

	December 31, 2013 Restructuring Reserve		2014 Expenses	2014 Cash Payments		March 31, 2014 Restructuring Reserve
	(Millions)
Employee Severance, Termination Benefits and Other Related Costs		$44	9	(5	)		$48

Under the terms of our amended and restated senior credit agreement that took effect on March 22, 2012, we are allowed to exclude $80 million of cash charges and expenses, before taxes, related to cost reduction initiatives incurred after March 22, 2012 from the calculation of the financial covenant ratios required under our senior credit facility. As of December 31, 2013, we had excluded all allowable charges relating to restructuring initiatives against the $80 million available under the terms of the senior credit facility.

On January 31, 2013, we announced our intent to reduce structural costs in Europe. This initiative includes the non-cash charges of $4 million we incurred in 2012 in connection with the announced closing of the Vittaryd facility in Sweden and a $7 million charge recorded in the fourth quarter of 2012 related to the impairment of certain assets in the European ride performance business. In August 2013, we completed the closure of the Vittaryd facility. As part of our European structural cost reduction initiative, on September 5, 2013 we announced our intent to close our ride performance plant in Gijon, Spain and reduce the workforce at our ride performance plant in Sint-Truiden, Belgium. The actions were subject to consultation with the relevant employee representatives. We concluded the consultation period with employee representatives at Gijon without having reached agreement and on December 17, 2013 notified the Gijon employees' works council that the Company was proceeding with the plant closure. Employee terminations at Gijon were completed by the end of 2013. During the first quarter of 2014, the employees' works council filed suit challenging the decision to close the Gijon plant and local High Court of Justice of Asturias ruled in favor of the employees' works council. On February 25, 2014, we announced the intention of the Company to appeal that decision to the Supreme Court of Spain in Madrid, and at the same time we are working closely with local and European government officials to reach a solution that will address the challenge to our restructuring plan by the Gijon plant's employees' works council. Negotiations with employee representatives at Sint-Truiden are continuing. We recorded $60 million in 2013 and $2 million in the first quarter of 2014 related to these actions at Gijon and Sint-Truiden. In the first quarter of 2014, we announced and finalized the closure of the clean air just-in-time plant in Iwuy, France, due to reduced demand for the plant's products. The actions were subject to the required consultation process with the relevant employee representatives.

17

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

(7) Environmental Matters, Legal Proceedings and Product Warranties

We are involved in environmental remediation matters, legal proceedings, claims, investigations and warranty obligations. These matters are typically incidental to the conduct of our business and create the potential for contingent losses. We accrue for potential contingent losses when our review of available facts indicates that it is probable a loss has been incurred and the amount of the loss is reasonably estimable. Each quarter we assess our loss contingencies based upon currently available facts, existing technology, presently enacted laws and regulations and taking into consideration the likely effects of inflation and other societal and economic factors and record adjustments to these reserves as required. As an example, we consider all available evidence, including prior experience in remediation of contaminated sites, other companies’ cleanup experiences and data released by the United States Environmental Protection Agency or other organizations when we evaluate our environmental remediation contingencies. All of our loss contingency estimates are subject to revision in future periods based on actual costs or new information. With respect to our environmental liabilities, where future cash flows are fixed or reliably determinable, we have discounted those liabilities. We evaluate recoveries separately from the liability and, when they are assured, recoveries are recorded and reported separately from the associated liability in our consolidated financial statements.

Environmental Matters

We are subject to a variety of environmental and pollution control laws and regulations in all jurisdictions in which we operate. We expense or capitalize, as appropriate, expenditures for ongoing compliance with environmental regulations that relate to current operations. We expense costs related to an existing condition caused by past operations that do not contribute to current or future revenue generation. As of March 31, 2014, we have the obligation to remediate or contribute towards the remediation of certain sites, including one Federal Superfund site. At March 31, 2014, our aggregated estimated share of environmental remediation costs for all these sites on a discounted basis was approximately $15 million, of which $3 million is recorded in other current liabilities and $12 million is recorded in deferred credits and other liabilities in our condensed consolidated balance sheet. For those locations where the liability was discounted, the weighted average discount rate used was 2.50 percent. The undiscounted value of the estimated remediation costs was $19 million. Our expected payments of environmental remediation costs are estimated to be approximately $3 million in 2014, $1 million in 2015, $1 million each year beginning 2016 through 2018 and $12 million in aggregate thereafter.

Based on information known to us, we have established reserves that we believe are adequate for these costs. Although we believe these estimates of remediation costs are reasonable and are based on the latest available information, the costs are estimates and are subject to revision as more information becomes available about the extent of remediation required. At some sites, we expect that other parties will contribute to the remediation costs. In addition, certain environmental statutes provide that our liability could be joint and several, meaning that we could be required to pay in excess of our share of remediation costs. Our understanding of the financial strength of other potentially responsible parties at these sites has been considered, where appropriate, in our determination of our estimated liability. We do not believe that any potential costs associated with our current status as a potentially responsible party in the Federal Superfund site, or as a liable party at the other locations referenced herein, will be material to our consolidated financial position, results of operations, or liquidity.

Antitrust Investigations

On March 25, 2014, representatives of the European Commission were at Tenneco GmbH's Edenkoben, Germany administrative facility to gather information in connection with an ongoing global antitrust investigation concerning multiple automotive suppliers. On March 25, 2014, we also received a related subpoena from the U.S. Department of Justice. We have cooperated and continue to cooperate fully with these antitrust investigations, and take other actions to minimize our potential exposure. Antitrust law investigations and related matters often continue for several years and can result in significant penalties and liability. At this point, we cannot estimate the ultimate impact on our company from investigations into our antitrust compliance and related matters in light of the uncertainties and many variables involved, and there can be no assurance that the ultimate resolution of these matters will not have a material adverse effect on our consolidated financial position, results of operations or liquidity.

Other Legal Proceedings, Claims and Investigations

We are also from time to time involved in other legal proceedings, claims or investigations. Some of these matters involve allegations of damages against us relating to environmental liabilities (including toxic tort, property damage and remediation), intellectual property matters (including patent, trademark and copyright infringement, and licensing disputes), personal injury claims (including injuries due to product failure, design or warning issues, and other product liability related

18

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

matters), taxes, employment matters, and commercial or contractual disputes, sometimes related to acquisitions or divestitures. Additionally, some of these matters involve allegations relating to legal compliance. For example, one of our Argentine subsidiaries is currently defending against a criminal complaint alleging the failure to comply with laws requiring the proceeds of export transactions to be collected, reported and/or converted to local currency within specified time periods. As another example, in the U.S. we are subject to an audit in 11 states with respect to the payment of unclaimed property to those states, spanning a period as far back as over 30 years. While we vigorously defend ourselves against all of these legal proceedings, claims and investigations and take other actions to minimize our potential exposure, in future periods, we could be subject to cash costs or charges to earnings if any of these matters are resolved on unfavorable terms. Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on current information, including our assessment of the merits of the particular claim, except as described above under "Antitrust Investigations," we do not expect the legal proceedings, claims or investigations currently pending against us will have any material adverse impact on our consolidated financial position, results of operations or liquidity.

In addition, we are subject to lawsuits initiated by a significant number of claimants alleging health problems as a result of exposure to asbestos. In the early 2000's we were named in nearly 20,000 complaints, most of which were filed in Mississippi state court and the vast majority of which made no allegations of exposure to asbestos from our product categories. Most of these claims have been dismissed and our current docket of active and inactive cases is less than 500 cases nationwide. A small number of claims have been asserted by railroad workers alleging exposure to asbestos products in railroad cars manufactured by The Pullman Company, one of our subsidiaries. The substantial majority of the remaining claims are related to alleged exposure to asbestos in our automotive products. Only a small percentage of the claimants allege that they were automobile mechanics and a significant number appear to involve workers in other industries or otherwise do not include sufficient information to determine whether there is any basis for a claim against us. We believe, based on scientific and other evidence, it is unlikely that mechanics were exposed to asbestos by our former products and that, in any event, they would not be at increased risk of asbestos-related disease based on their work with these products. Further, many of these cases involve numerous defendants, with the number in some cases exceeding 100 defendants from a variety of industries. Additionally, the plaintiffs either do not specify any, or specify the jurisdictional minimum, dollar amount for damages. As major asbestos manufacturers and/or users continue to go out of business or file for bankruptcy, we may experience an increased number of these claims. We vigorously defend ourselves against these claims as part of our ordinary course of business. In future periods, we could be subject to cash costs or charges to earnings if any of these matters are resolved unfavorably to us. To date, with respect to claims that have proceeded sufficiently through the judicial process, we have regularly achieved favorable resolutions. Accordingly, we presently believe that these asbestos-related claims will not have a material adverse impact on our future consolidated financial position, results of operations or liquidity.

Warranty Matters

We provide warranties on some of our products. The warranty terms vary but range from one year up to limited lifetime warranties on some of our premium aftermarket products. Provisions for estimated expenses related to product warranty are made at the time products are sold or when specific warranty issues are identified on OE products. These estimates are established using historical information about the nature, frequency, and average cost of warranty claims. We actively study trends of our warranty claims and take action to improve product quality and minimize warranty claims. We believe that the warranty reserve is appropriate; however, actual claims incurred could differ from the original estimates, requiring adjustments to the reserve. The reserve is included in both current and long-term liabilities on the balance sheet.

Below is a table that shows the activity in the warranty accrual accounts:

	Three Months Ended March 31,
	2014			2013
	(Millions)
Beginning Balance January 1,	$	24		$	23
Accruals related to product warranties	5			2
Reductions for payments made	(5		)	(4		)
Ending Balance March 31,	$	24		$	21

(8) Earnings Per Share

Earnings per share of common stock outstanding were computed as follows:

19

	Three Months Ended March 31, 2014		Three Months Ended March 31, 2013
	(Millions Except Share and Per Share Amounts)
Basic earnings per share —
Net income attributable to Tenneco Inc.	$	46	$	54
Weighted Average shares of common stock outstanding	60,549,778		60,288,997
Earnings per share of common stock	$	0.76	$	0.90
Diluted earnings per share —
Net income attributable to Tenneco Inc.	$	46	$	54
Weighted Average shares of common stock outstanding	60,549,778		60,288,997
Effect of dilutive securities:
Restricted stock	160,341		138,594
Stock options	793,183		1,054,244
Weighted Average shares of common stock outstanding including dilutive securities	61,503,302		61,481,835
Earnings per share of common stock	$	0.75	$	0.88

Options to purchase 782 and 831,243 shares of common stock were outstanding as of March 31, 2014 and 2013, respectively, but not included in the computation of diluted earnings per share respectively, because the options were anti-dilutive.

(9) Common Stock

Equity Plans — We have granted a variety of awards, including common stock, restricted stock, restricted stock units, performance units, stock appreciation rights (“SARs”), and stock options to our directors, officers, and employees.

Accounting Methods — We have recorded $2 million in compensation expense in each of the three month periods ended March 31, 2014 and 2013 related to nonqualified stock options as part of our selling, general and administrative expense. This resulted in a decrease of $0.04 in both basic and diluted earnings per share for the three month period ended March 31, 2014 and a decrease of $0.04 and $0.03 in basic and diluted earnings per share, respectively, for the three month period ended March 31, 2013.

For employees eligible to retire at the grant date, we immediately expense stock options and restricted stock. If employees become eligible to retire during the vesting period, we immediately recognize any remaining expense associated with their stock options and restricted stock.

As of March 31, 2014, there was approximately $9 million of unrecognized compensation costs related to our stock option awards that we expect to recognize over a weighted average period of 1.6 years.

Compensation expense for restricted stock, restricted stock units, long-term performance units and SARs was $8 million and $5 million for the three months ended March 31, 2014 and 2013, respectively, and was recorded in selling, general, and administrative expense in our condensed consolidated statements of income.

Cash received from stock option exercises for the quarter ended March 31, 2014 was less than $1 million and was $2 million for the quarter ended March 31, 2013.

Stock options exercised in the quarter ended March 31, 2013 would have generated a tax benefit of $1 million, however in 2013 we did not begin to record this tax benefit until the third quarter 2013 when we began utilizing our federal and state NOLs. In the first quarter of 2014, we recorded a tax benefit of $12 million, all of which was related to the historic tax benefit on stock options from 2011 through 2013.

Assumptions — We calculated the fair values of stock option awards using the Black-Scholes option pricing model with the weighted average assumptions listed below. The fair value of share-based awards is determined at the time the awards are granted which is generally in January of each year, and requires judgment in estimating employee and market behavior.

20

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

	Three Months Ended March 31,
	2014			2013
Stock Options Granted
Weighted average grant date fair value, per share	$	26.46		$	19.84
Weighted average assumptions used:
Expected volatility	52.8		%	66.4		%
Expected lives	5.0			4.9
Risk-free interest rates	1.7		%	0.7		%
Dividend yields	—		%	—		%

Expected volatility is calculated based on current implied volatility and historical realized volatility for the Company.

Expected lives of options are based upon the historical and expected time to post-vesting forfeiture and exercise. We believe this method is the best estimate of the future exercise patterns currently available.

The risk-free interest rates are based upon the Constant Maturity Rates provided by the U.S. Treasury. For our valuations, we used the continuous rate with a term equal to the expected life of the options.

Stock Options — The following table reflects the status and activity for all options to purchase common stock for the period indicated:

	Three Months Ended March 31, 2014
	Shares Under Option		Weighted Avg. Exercise Prices		Weighted Avg. Remaining Life in Years	Aggregate Intrinsic Value
						(Millions)
Outstanding Stock Options
Outstanding, January 1, 2014	1,983,573		$	22.93	4.5	$	62
Granted	192,624		56.23
Canceled	(31,299	)	19.78
Forfeited	(300	)	22.77
Exercised	(25,595	)	14.72			1
Outstanding, March 31, 2014	2,119,003		$	26.10	4.6	$	67

The weighted average grant-date fair value of options granted during the three months ended March 31, 2014 and 2013 was $26.46 and $19.84, respectively. The total fair value of shares vested was $6 million and $5 million for the periods ended March 31, 2014 and 2013, respectively.

Restricted Stock — The following table reflects the status for all nonvested restricted shares for the period indicated:

	Three Months Ended March 31, 2014
	Shares		Weighted Avg. Grant Date Fair Value
Nonvested Restricted Shares
Nonvested balance at January 1, 2014	368,268		$	34.90
Granted	131,561		54.90
Vested	(186,112	)	36.57
Forfeited	—		—
Nonvested balance at March 31, 2014	313,717		$	42.30

The fair value of restricted stock grants is equal to the average of the high and low trading price of our stock on the date of grant. As of March 31, 2014, approximately $10 million of total unrecognized compensation costs related to restricted stock awards is expected to be recognized over a weighted-average period of approximately 2.2 years. The total fair value of restricted shares vested was $7 million and $5 million at March 31, 2014 and 2013, respectively.

21

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

In January 2014, our Board of Directors approved a share repurchase program, authorizing our company to repurchase up to 400,000 shares of our outstanding common stock over a 12 month period. This share repurchase program is intended to offset dilution from shares of restricted stock and stock options issued in 2014 to employees. We did not purchase any shares through this program in the three month period ended March 31, 2014.

These repurchased shares are held as part of our treasury stock which was at 2,844,692 shares at both March 31, 2014 and December 31, 2013.

Long-Term Performance Units, Restricted Stock Units and SARs — Long-term performance units, restricted stock units and SARs are paid in cash and recognized as a liability based upon their fair value. As of March 31, 2014, $26 million of total unrecognized compensation costs is expected to be recognized over a weighted-average period of approximately 2.1 years.

(10) Pension Plans, Postretirement and Other Employee Benefits

Net periodic pension costs and postretirement benefit costs consist of the following components:

	Three Months Ended March 31,
	Pension												Postretirement
	2014						2013						2014			2013
	US			Foreign			US			Foreign			US			US
	(Millions)
Service cost — benefits earned during the period	$	—		$	2		$	—		$	2		$	—		$	—
Interest cost	5			5			5			4			1			1
Expected return on plan assets	(6		)	(6		)	(5		)	(5		)	—			—
Net amortization:
Actuarial loss	2			2			2			3			1			1
Prior service cost (credit)	—			—			—			—			(2		)	(1		)
Net pension and postretirement costs	$	1		$	3		$	2		$	4		$	—		$	1

For the three months ended March 31, 2014, we made pension contributions of $7 million and $4 million for our domestic and foreign pension plans, respectively. Based on current actuarial estimates, we believe we will be required to contribute approximately $36 million for the remainder of 2014. Pension contributions beyond 2014 will be required, but those amounts will vary based upon many factors including, for example, the performance of our pension fund investments during 2014.

We made postretirement contributions of approximately $2 million during the first three months of 2014. Based on current actuarial estimates, we believe we will be required to contribute approximately $6 million for the remainder of 2014.

The assets of some of our pension plans are invested in trusts that permit commingling of the assets of more than one employee benefit plan for investment and administrative purposes. Each of the plans participating in the trust has interests in the net assets of the underlying investment pools of the trusts. The investments for all our pension plans are recorded at estimated fair value, in compliance with the accounting guidance on fair value measurement.

Amounts recognized for pension and postretirement benefits in other comprehensive income for the three periods ended March 31, 2014 and 2013 include the following components:

22

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

	Three Months Ended March 31,
	2014							2013
	Before-Tax Amount		Tax Benefit			Net-of-Tax Amount		Before- Tax Amount			Tax Benefit			Net-of-Tax Amount
	(Millions)
Defined benefit pension and postretirement plans:
Amortization of prior service cost included in net periodic pension and postretirement cost	$	—	$	—		$	—	$	(1	)	$	—		$	(1	)
Amortization of actuarial loss included in net periodic pension and postretirement cost	4		(1		)	3		6			(1		)	5
Other comprehensive income – pension benefits	$	4	$	(1	)	$	3	$	5		$	(1	)	$	4

(11) New Accounting Pronouncements

In July 2013, the Financial Accounting Standards Board (“FASB”) issued an amendment to provide explicit guidance on financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, similar tax loss, or tax credit carryforward exists. The objective of the amendment is to eliminate the diversity in practice in the presentation of unrecognized tax benefits in those instances. This amendment is effective for reporting periods beginning after December 15, 2013. We adopted this amendment on January 1, 2014. This amendment did not have a material impact on our consolidated financial statements.

In April 2013, the FASB issued an amendment to clarify when an entity should apply the liquidation basis of accounting and to provide principles for the measurement of assets and liabilities under the liquidation basis of accounting, as well as any required disclosures. The amendment applies to all entities that issue financial statements that are presented in conformity with U.S. GAAP except investment companies that are regulated under the Investment Company Act of 1940. This amendment is effective for reporting periods beginning after December 15, 2013. This amendment did not have any impact on our consolidated financial statements.

In February 2013, the FASB issued an amendment to resolve the diversity in practice about whether Subtopic 810-10, Consolidation-Overall, or Subtopic 830-30, Foreign Currency Matters-Translation of Financial Statements, applies to the release of the cumulative translation adjustment into net income when a parent either sells a part of all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business (other than a sale of in substance real state or conveyance of oil and gas mineral rights) within a foreign entity. In addition, the amendments resolve the diversity in practice for the treatment of business combinations achieved in stages (sometimes also referred to as step acquisitions) involving a foreign entity. This amendment is effective for reporting periods beginning after December 15, 2013. This amendment did not have any impact on our consolidated financial statements.

In February 2013, the FASB issued an amendment to the accounting guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation is fixed at the reporting date, except for obligations addressed within existing guidance in U.S. GAAP. The guidance requires an entity to measure those obligations as the sum of the amount the reporting entity agreed to pay on the basis of its arrangement amount its co-obligors and any additional amount the reporting entity expects to pay on behalf of its co-obligors. The guidance in this amendment also requires an entity to disclose the nature and amount of the obligation as well as other information about those obligations. This amendment is effective for reporting periods beginning after December 15, 2013. This amendment did not have any impact on our consolidated financial statements.

In February 2013, the FASB issued an amendment to the accounting guidance to improve the transparency of reporting amounts reclassified out of other comprehensive income. Other comprehensive income (loss) includes gains and losses that are initially excluded from net income for an accounting period. Those gains and losses are later reclassified out of accumulated other comprehensive income into net income. This amendment does not change the current requirements for reporting net income or other comprehensive income in the financial statements. All of the information that this amendment requires already is required to be disclosed elsewhere in the financial statements under U.S. GAAP. This new amendment requires presentation either on the face of the statement where net income is presented or in the notes, the effects of significant amounts reclassified out of accumulated other comprehensive income, and that the reclassified amounts be cross-referenced to the other disclosures

23

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

required under U.S. GAAP. This amendment was effective for reporting periods beginning after December 15, 2012. This amendment did not have a material impact on our condensed consolidated financial statements.

(12) Segment Information

In connection with the organizational changes announced on February 14, 2013 that aligned our businesses along product lines, effective with the first quarter of 2013, our three prior geographic reportable segments have each been split into two product segments. Beginning with 2013, we are managed and organized along our two major product lines (clean air and ride performance) and three geographic areas (North America; Europe, South America and India; and Asia Pacific), resulting in six operating segments (North America Clean Air, North America Ride Performance, Europe, South America and India Clean Air, Europe, South America and India Ride Performance, Asia Pacific Clean Air and Asia Pacific Ride Performance). Within each geographical area, each operating segment manufactures and distributes either clean air or ride performance products primarily for the original equipment and aftermarket industries. Each of the six operating segments constitutes a reportable segment. Costs related to other business activities, primarily corporate headquarter functions, are disclosed separately from the six operating segments as "Other." We evaluate segment performance based primarily on earnings before interest expense, income taxes, and noncontrolling interests. Products are transferred between segments and geographic areas on a basis intended to reflect as nearly as possible the “market value” of the products. Prior period segment information has been revised to reflect our new reporting segments.

The following table summarizes certain Tenneco Inc. segment information:

	Clean Air Division						Ride Performance Division
	North America		Europe, South America & India		Asia Pacific		North America		Europe, South America & India		Asia Pacific		Other			Reclass & Elims			Total
	(Millions)
At March 31, 2014 and for the Three Months Ended March 31, 2014
Revenues from external customers	$	698	$	506	$	240	$	335	$	263	$	52	$	—		$	—		$	2,094
Intersegment revenues	7		29		—		3		10		9		—			(58		)	—
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	56		9		20		30		16		7		(25		)	—			113
Total assets	1,197		908		563		701		557		219		—			34			4,179
At March 31, 2013 and for the Three Months Ended March 31, 2013
Revenues from external customers	646		467		183		307		252		48		—			—			1,903
Intersegment revenues	1		31		—		2		12		7		—			(53		)	—
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	49		11		15		25		10		4		(21		)	—			93
Total assets	1,144		833		469		645		557		207		—			23			3,878

24

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

(13) Supplemental Guarantor Condensed Consolidating Financial Statements

Basis of Presentation

Substantially all of our existing and future material domestic 100% owned subsidiaries (which are referred to as the Guarantor Subsidiaries) fully and unconditionally guarantee our senior notes due in 2018 and 2020 on a joint and several basis. However, a subsidiary’s guarantee may be released in certain customary circumstances such as a sale of the subsidiary or all or substantially all of its assets in accordance with the indenture applicable to the notes. The Guarantor Subsidiaries are combined in the presentation below.

These consolidating financial statements are presented on the equity method. Under this method, our investments are recorded at cost and adjusted for our ownership share of a subsidiary’s cumulative results of operations, capital contributions and distributions, and other equity changes. You should read the condensed consolidating financial information of the Guarantor Subsidiaries in connection with our condensed consolidated financial statements and related notes of which this note is an integral part.

Distributions

There are no significant restrictions on the ability of the Guarantor Subsidiaries to make distributions to us.

25

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

STATEMENT OF COMPREHENSIVE INCOME (LOSS)

	For the Three Months Ended March 31, 2014
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims			Consolidated
	(Millions)
Revenues
Net sales and operating revenues —
External	$	920		$	1,174		$	—		$	—		$	2,094
Affiliated companies	103			148			—			(251		)	—
	1,023			1,322			—			(251		)	2,094
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	802			1,203			—			(251		)	1,754
Engineering, research, and development	22			20			—			—			42
Selling, general, and administrative	51			79			2			—			132
Depreciation and amortization of other intangibles	21			30			—			—			51
	896			1,332			2			(251		)	1,979
Other income (expense)
Loss on sale of receivables	—			(1		)	—			—			(1		)
Other income (loss)	(2		)	1			—			—			(1		)
	(2		)	—			—			—			(2		)
Earnings (loss) before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies	125			(10		)	(2		)	—			113
Interest expense —
External (net of interest capitalized)	—			—			19			—			19
Affiliated companies (net of interest income)	16			(16		)	—			—			—
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies	109			6			(21		)	—			94
Income tax expense	30			10									40
Equity in net income (loss) from affiliated companies	(15		)	—			67			(52		)	—
Net Income (loss)	64			(4		)	46			(52		)	54
Less: Net income attributable to noncontrolling interests	—			8			—			—			8
Net income (loss) attributable to Tenneco Inc.	$	64		$	(12	)	$	46		$	(52	)	$	46
Comprehensive income (loss) attributable to Tenneco Inc.	$	65		$	(16	)	$	46		$	(52	)	$	43

26

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

STATEMENT OF COMPREHENSIVE INCOME (LOSS)

	For the Three Months Ended March 31, 2013
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims			Consolidated
	(Millions)
Revenues
Net sales and operating revenues —
External	$	852		$	1,051		$	—		$	—		$	1,903
Affiliated companies	79			150			—			(229		)	—
	931			1,201			—			(229		)	1,903
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	742			1,091			—			(229		)	1,604
Engineering, research, and development	15			20			—			—			35
Selling, general, and administrative	53			64			2			—			119
Depreciation and amortization of other intangibles	19			31			—			—			50
	829			1,206			2			(229		)	1,808
Other income (expense)
Loss on sale of receivables	—			(1		)	—			—			(1		)
Other income (expense)	(1		)	—			—			—			(1		)
	(1		)	(1		)	—			—			(2		)
Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies	101			(6		)	(2		)	—			93
Interest expense —
External (net of interest capitalized)	—			1			19			—			20
Affiliated companies (net of interest income)	18			(19		)	1			—			—
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies	83			12			(22		)	—			73
Income tax expense	6			6			—			—			12
Equity in net income (loss) from affiliated companies	(5		)	—			76			(71		)	—
Net income (loss)	72			6			54			(71		)	61
Less: Net income attributable to noncontrolling interests	—			7			—			—			7
Net income (loss) attributable to Tenneco Inc.	$	72		$	(1	)	$	54		$	(71	)	$	54
Comprehensive income (loss) attributable to Tenneco Inc.	$	67		$	(18	)	$	54		$	(71	)	$	32

27

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

BALANCE SHEET

	March 31, 2014
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims			Consolidated
	(Millions)
ASSETS
Current assets:
Cash and cash equivalents	$	2		$	265		$	—		$	—		$	267
Restricted cash	—			6			—			—			6
Receivables, net	593			1,464			16			(785		)	1,288
Inventories	314			423			—			—			737
Deferred income taxes	88			—			7			(24		)	71
Prepayments and other	41			217			1			—			259
Total current assets	1,038			2,375			24			(809		)	2,628
Other assets:
Investment in affiliated companies	926			—			768			(1,694		)	—
Notes and advances receivable from affiliates	1,030			8,124			5,004			(14,158		)	—
Long-term receivables, net	12			2			—			—			14
Goodwill	22			47			—			—			69
Intangibles, net	12			17			—			—			29
Deferred income taxes	61			9			47			—			117
Other	45			61			22			—			128
	2,108			8,260			5,841			(15,852		)	357
Plant, property, and equipment, at cost	1,187			2,358			—			—			3,545
Less — Accumulated depreciation and amortization	(817		)	(1,534		)	—			—			(2,351		)
	370			824			—			—			1,194
Total assets	$	3,516		$	11,459		$	5,865		$	(16,661	)	$	4,179
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	$	—		$	91		$	15		$	—		$	106
Short-term debt — affiliated	217			336			10			(563		)	—
Trade payables	539			1,066			—			(175		)	1,430
Accrued taxes	9			35			—			—			44
Other	134			298			13			(71		)	374
Total current liabilities	899			1,826			38			(809		)	1,954
Long-term debt — non-affiliated	—			7			1,202			—			1,209
Long-term debt — affiliated	1,878			8,145			4,135			(14,158		)	—
Deferred income taxes	—			29			—			—			29
Postretirement benefits and other liabilities	339			86			(1		)	5			429
Commitments and contingencies
Total liabilities	3,116			10,093			5,374			(14,962		)	3,621
Redeemable noncontrolling interests	—			25			—			—			25
Tenneco Inc. shareholders’ equity	400			1,299			491			(1,699		)	491
Noncontrolling interests	—			42			—			—			42
Total equity	400			1,341			491			(1,699		)	533
Total liabilities, redeemable noncontrolling interests and equity	$	3,516		$	11,459		$	5,865		$	(16,661	)	$	4,179

28

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

BALANCE SHEET

	December 31, 2013
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)		Reclass & Elims			Consolidated
	(Millions)
ASSETS
Current assets:
Cash and cash equivalents	$	6		$	269		$	—	$	—		$	275
Restricted cash	—			5			—		—			5
Receivables, net	387			1,306			16		(649		)	1,060
Inventories	279			377			—		—			656
Deferred income taxes	87			—			7		(23		)	71
Prepayments and other	35			188			—		—			223
Total current assets	794			2,145			23		(672		)	2,290
Other assets:
Investment in affiliated companies	944			—			696		(1,640		)	—
Notes and advances receivable from affiliates	1,026			7,320			4,826		(13,172		)	—
Long-term receivables, net	12			2			—		—			14
Goodwill	22			47			—		—			69
Intangibles, net	13			17			—		—			30
Deferred income taxes	72			9			44		—			125
Other	44			60			23		—			127
	2,133			7,455			5,589		(14,812		)	365
Plant, property, and equipment, at cost	1,173			2,325			—		—			3,498
Less — Accumulated depreciation and amortization	(807		)	(1,516		)	—		—			(2,323		)
	366			809			—		—			1,175
Total assets	$	3,293		$	10,409		$	5,612	$	(15,484	)	$	3,830
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	$	—		$	68		$	15	$	—		$	83
Short-term debt — affiliated	247			176			10		(433		)	—
Trade payables	521			1,011			—		(173		)	1,359
Accrued taxes	9			31			—		—			40
Other	128			285			9		(66		)	356
Total current liabilities	905			1,571			34		(672		)	1,838
Long-term debt — non-affiliated	—			8			1,011		—			1,019
Long-term debt — affiliated	1,700			7,338			4,134		(13,172		)	—
Deferred income taxes	—			28			—		—			28
Postretirement benefits and other liabilities	357			92			—		4			453
Commitments and contingencies
Total liabilities	2,962			9,037			5,179		(13,840		)	3,338
Redeemable noncontrolling interests	—			20			—		—			20
Tenneco Inc. shareholders’ equity	331			1,313			433		(1,644		)	433
Noncontrolling interests	—			39			—		—			39
Total equity	331			1,352			433		(1,644		)	472
Total liabilities, redeemable noncontrolling interests and equity	$	3,293		$	10,409		$	5,612	$	(15,484	)	$	3,830

29

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

STATEMENT OF CASH FLOWS

	Three Months Ended March 31, 2014
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims		Consolidated
	(Millions)
Operating Activities
Net cash provided (used) by operating activities	$	(208	)	$	90		$	(22	)	$	—	$	(140	)
Investing Activities
Cash payments for plant, property, and equipment	(25		)	(58		)	—			—		(83		)
Cash payments for software related intangible assets	(4		)	(3		)	—			—		(7		)
Changes in restricted cash	—			(1		)	—			—		(1		)
Net cash used by investing activities	(29		)	(62		)	—			—		(91		)
Financing Activities
Issuance (repurchase) of common shares	—			—			(2		)	—		(2		)
Tax benefit from stock-based compensation	—			—			12			—		12
Retirement of long-term debt	—			—			(3		)	—		(3		)
Increase (decrease) in bank overdrafts	—			4						—		4
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivables	—			24			173			—		197
Net increase (decrease) in short-term borrowings secured by accounts receivables	—			—			20			—		20
Intercompany dividends and net increase (decrease) in intercompany obligations	233			(55		)	(178		)	—		—
Capital contribution from noncontrolling interest partners	—			1			—			—		1
Net cash provided (used) by financing activities	233			(26		)	22			—		229
Effect of foreign exchange rate changes on cash and cash equivalents	—			(6		)	—			—		(6		)
Increase (decrease) in cash and cash equivalents	(4		)	(4		)	—			—		(8		)
Cash and cash equivalents, January 1	6			269			—			—		275
Cash and cash equivalents, March 31 (Note)	$	2		$	265		$	—		$	—	$	267

Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase.

30

TENNECO INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS —(Continued)

(Unaudited)

STATEMENT OF CASH FLOWS

	Three Months Ended March 31, 2013
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims		Consolidated
	(Millions)
Operating Activities
Net cash provided (used) by operating activities	$	(102	)	$	15		$	(5	)	$	—	$	(92	)
Investing Activities
Proceeds from sale of assets	—			2			—			—		2
Cash payments for plant, property, and equipment	(32		)	(38		)	—			—		(70		)
Cash payments for software related intangible assets	(3		)	(3		)	—			—		(6		)
Changes in restricted cash	—			(9		)						(9		)
Net cash used by investing activities	(35		)	(48		)	—			—		(83		)
Financing Activities
Issuance of common shares	—			—			1			—		1
Retirement of long-term debt	—			—			(5		)	—		(5		)
Increase (decrease) in bank overdrafts	—			(9		)	—			—		(9		)
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt	—			3			188			—		191
Intercompany dividends and net increase (decrease) in intercompany obligations	137			42			(179		)	—		—
Net cash provided by financing activities	137			36			5			—		178
Effect of foreign exchange rate changes on cash and cash equivalents	—			7			—			—		7
Increase (decrease) in cash and cash equivalents	—			10			—			—		10
Cash and cash equivalents, January 1	4			219			—			—		223
Cash and cash equivalents, March 31 (Note)	$	4		$	229		$	—		$	—	$	233

Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase.

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ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

As you read the following review of our financial condition and results of operations, you should also read our condensed consolidated financial statements and related notes beginning on page 6.

Executive Summary

We are one of the world's leading manufacturers of clean air and ride performance products and systems for light vehicle, commercial truck and off-highway applications. We serve both original equipment (OE) vehicle designers and manufacturers and the repair and replacement markets, or aftermarket, globally through leading brands, including Monroe^®, Rancho^®, Clevite^® Elastomers, Marzocchi^®, Axios^™, Kinetic^™ and Fric-Rot^™ ride performance products and Walker^®, XNOx^™, Fonos^™, DynoMax^®, and Thrush^™ clean air products. We serve more than 65 different original equipment manufacturers and commercial truck and off-highway engine manufacturers, and our products are included on nine of the top 10 car models produced for sale in Europe and eight of the top 10 light truck models produced for sale in North America for 2013. Our aftermarket customers are comprised of full-line and specialty warehouse distributors, retailers, jobbers, installer chains and car dealers. As of December 31, 2013, we operated 89 manufacturing facilities worldwide and employed approximately 26,000 people to service our customers' demands.

Factors that continue to be critical to our success include winning new business awards, managing our overall global manufacturing footprint to ensure proper placement and workforce levels in line with business needs, maintaining competitive wages and benefits, maximizing efficiencies in manufacturing processes and reducing overall costs. In addition, our ability to adapt to key industry trends, such as a shift in consumer preferences to other vehicles in response to higher fuel costs and other economic and social factors, increasing technologically sophisticated content, changing aftermarket distribution channels, increasing environmental standards and extended product life of automotive parts, also play a critical role in our success. Other factors that are critical to our success include adjusting to economic challenges such as increases in the cost of raw materials and our ability to successfully reduce the impact of any such cost increases through material substitutions, cost reduction initiatives and other methods.

For the first quarter of 2014, light vehicle production was up six percent in North America, 10 percent in China and seven percent in Europe. Light vehicle production was down eight percent in South America, 10 percent in India and seven percent in Australia in the first quarter of 2014 when compared to the first quarter of 2013.

Total revenues for the first quarter of 2014 were $2,094 million, up from $1,903 million in the first quarter of 2013. Excluding the impact of currency and substrate sales, revenue was up $184 million, or 13 percent, from $1,449 million to $1,633 million, driven primarily by stronger global OE light vehicle volumes, higher OE commercial truck, off-highway and other revenue in all reporting segments and increased aftermarket Ride Performance sales in Europe and South America.

Cost of sales (exclusive of depreciation and amortization): Cost of sales for the first quarter of 2014 was $1,754 million, or 83.8 percent of sales, compared to $1,604 million, or 84.3 percent of sales in the first quarter of 2013. The following table lists the primary drivers behind the change in cost of sales ($ millions).

Quarter ended March 31, 2013	$	1,604
Volume and mix	163
Material	(7		)
Currency exchange rates	(15		)
Restructuring	3
Other Costs	6
Quarter ended March 31, 2014	$	1,754

The increase in cost of sales was due primarily to the year-over-year increase in volume, higher restructuring costs and other costs, mainly manufacturing, partially offset by lower net material costs and the impact of currency exchange rates.

Gross margin: Revenue less cost of sales for the first quarter of 2014 was $340 million, or 16.2 percent, versus $299 million, or 15.7 percent, in the first quarter of 2013. The effect on gross margin resulting from higher volumes was partially offset by higher restructuring expenses, other costs, mainly manufacturing and negative currency.

Engineering, research and development: Engineering, research and development expense was $42 million and $35 million in the first quarters of 2014 and 2013, respectively. Increased spending to support customer programs drove the year-over-year increase.

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Selling, general and administrative: Selling, general and administrative expense was up $13 million in the first quarter of 2014, at $132 million, compared to $119 million in the first quarter of 2013. The year-over-year increase is due to higher compensation related accruals, growth in emerging markets and other corporate expenses.

Depreciation and amortization: Depreciation and amortization expense was $51 million in the first quarter of 2014, compared to $50 million in the first quarter of 2013.

Earnings before interest expense, taxes and noncontrolling interests (“EBIT”) were $113 million for the first quarter of 2014, an increase of $20 million when compared to $93 million in the first quarter of the prior year. Higher light vehicle volumes globally, commercial truck and off-highway revenue growth, new platforms and an increase in commercial vehicle content, higher Ride Performance aftermarket sales and strong operational performance were partially offset by higher restructuring and related expenses, higher engineering expense, a $7 million adjustment to workers' compensation reserves and $5 million negative currency.

Results from Operations

The tables below reflect our revenues for the first quarters of 2014 and 2013. We show the component of our OE revenue represented by substrate sales. While we generally have primary design, engineering and manufacturing responsibility for OE emission control systems, we do not manufacture substrates. Substrates are porous ceramic filters coated with a catalyst - typically, precious metals such as platinum, palladium and rhodium. These are supplied to us by Tier 2 suppliers generally as directed by our OE customers. We generally earn a small margin on these components of the system. As the need for more sophisticated emission control solutions increases to meet more stringent environmental regulations, and as we capture more diesel aftertreatment business, these substrate components have been increasing as a percentage of our revenue. While these substrates dilute our gross margin percentage, they are a necessary component of an emission control system.

Our value-add content in an emission control system includes designing the system to meet environmental regulations through integration of the substrates into the system, maximizing use of thermal energy to heat up the catalyst quickly, efficiently managing airflow to reduce back pressure as the exhaust stream moves past the catalyst, managing the expansion and contraction of the emission control system components due to temperature extremes experienced by an emission control system, using advanced acoustic engineering tools to design the desired exhaust sound, minimizing the opportunity for the fragile components of the substrate to be damaged when we integrate it into the emission control system and reducing unwanted noise, vibration and harshness transmitted through the emission control system.

We present these substrate sales separately in the following table because we believe investors utilize this information to understand the impact of this portion of our revenues on our overall business and because it removes the impact of potentially volatile precious metals pricing from our revenues. While our original equipment customers generally assume the risk of precious metals pricing volatility, it impacts our reported revenues. Presenting revenues that exclude “substrates” used in catalytic converters and diesel particulate filters removes this impact.

Additionally, we present these reconciliations of revenues in order to reflect value-add revenues without the effect of changes in foreign currency rates. We have not reflected any currency impact in the 2013 table since this is the base period for measuring the effects of currency during 2014 on our operations. We believe investors find this information useful in understanding period-to-period comparisons in our revenues.

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Net Sales and Operating Revenues for the Three Months Ended March 31, 2014 and 2013

	Three Months Ended March 31, 2014
	Revenues		Substrate Sales		Value-add Revenues		Currency Impact on Value-add Revenues			Value-add Revenues excluding Currency
	(Millions)
Clean Air Division
North America	$	698	$	264	$	434	$	(1	)	$	435
Europe, South America & India	506		172		334		(1		)	335
Asia Pacific	240		48		192		—			192
Total Clean Air Division	1,444		484		960		(2		)	962
Ride Performance Division
North America	335		—		335		(4		)	339
Europe, South America & India	263		—		263		(15		)	278
Asia Pacific	52		—		52		(2		)	54
Total Ride Performance Division	650		—		650		(21		)	671
Total Tenneco Inc.	$	2,094	$	484	$	1,610	$	(23	)	$	1,633

	Three Months Ended March 31, 2013
	Revenues		Substrate Sales		Value-add Revenues		Currency Impact on Value-add Revenues		Value-add Revenues excluding Currency
	(Millions)
Clean Air Division
North America	$	646	$	260	$	386	$	—	$	386
Europe, South America & India	467		169		298		—		298
Asia Pacific	183		25		158		—		158
Total Clean Air Division	1,296		454		842		—		842
Ride Performance Division
North America	307		—		307		—		307
Europe, South America & India	252		—		252		—		252
Asia Pacific	48		—		48		—		48
Total Ride Performance Division	607		—		607		—		607
Total Tenneco Inc.	$	1,903	$	454	$	1,449	$	—	$	1,449

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	Three Months Ended March 31, 2014 Versus Three Months Ended March 31, 2013 Dollar and Percent Increase (Decrease)
	Revenues		Percent		Value-add Revenues excluding Currency		Percent
	(Millions Except Percent Amounts)
Clean Air Division
North America	$	52	8	%	$	49	13	%
Europe, South America & India	39		8	%	37		12	%
Asia Pacific	57		31	%	34		22	%
Total Clean Air Division	148		11	%	120		14	%
Ride Performance Division
North America	28		9	%	32		10	%
Europe, South America & India	11		4	%	26		10	%
Asia Pacific	4		8	%	6		13	%
Total Ride Performance Division	43		7	%	64		11	%
Total Tenneco Inc.	$	191	10	%	$	184	13	%

Light Vehicle Industry Production by Region for Three Months Ended March 31, 2014 and 2013 (According to IHS Automotive, April 2014)

	Three Months Ended March 31,
	2014	2013	Increase (Decrease)		% Increase (Decrease)
	(Number of Vehicles in Thousands)
North America	4,245	4,015	230		6	%
Europe	5,161	4,820	341		7	%
South America	940	1,020	(80	)	(8	)%
India	922	1,025	(103	)	(10	)%
Total Europe, South America & India	7,023	6,865	158		2	%
China	5,645	5,111	534		10	%
Australia	43	46	(3	)	(7	)%

Clean Air revenue was up $148 million in the first quarter of 2014 compared to the first quarter of 2013, driven by higher sales in all the regions. The increase in North American revenues was driven by higher light vehicle volumes, new platform launches and increased off-highway revenues, which accounted for $59 million of the year-over-year change in revenues. Currency had a $1 million unfavorable impact on North American revenues. The increase in European, South American and Indian revenues was mostly driven by higher volumes of $38 million, mainly due to higher year-over-year light vehicle and commercial truck and off-highway vehicle revenues in Europe. Currency had a $2 million favorable impact on European, South American and Indian revenues. The increase in Asia Pacific revenues was primarily driven by higher volumes of $61 million, mostly due to higher light vehicle production, new programs and commercial truck volumes in China. Currency had no impact on Asia Pacific revenues.

Ride Performance revenue was up $43 million in the first quarter of 2014 compared to the first quarter of 2013, primarily driven by higher volumes in all the regions. The increase in North American revenues was primarily driven by higher volumes and mix of $31 million due to light vehicle and commercial truck volume growth. Currency had a $4 million unfavorable impact on North American revenues. The increase in European, South American and Indian revenues was primarily driven by higher volumes of $21 million due to Europe and South America aftermarket sales growth and increased volumes in Europe light vehicle and commercial truck. Currency had a $15 million unfavorable impact on European, South American and Indian revenues. The increase in Asia Pacific revenues was driven by higher volumes of $7 million, mostly due to higher light vehicle production volumes in China. Currency had a $2 million unfavorable impact on Asia Pacific revenues.

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Earnings before Interest Expense, Income Taxes and Noncontrolling Interests (“EBIT”) for the Three Months Ended March 31, 2014 and 2013

	Three Months Ended March 31,						Change
	2014			2013
	(Millions)
Clean Air Division
North America	$	56		$	49		$	7
Europe, South America & India	9			11			(2		)
Asia Pacific	20			15			5
Total Clean Air Division	85			75			10
Ride Performance Division
North America	30			25			5
Europe, South America & India	16			10			6
Asia Pacific	7			4			3
Total Ride Performance Division	53			39			14
Other	(25		)	(21		)	(4		)
Total Tenneco Inc.	$	113		$	93		$	20

The EBIT results shown in the preceding table include the following items, certain of which are discussed below under “Restructuring and Other Charges,” which have an effect on the comparability of EBIT results between periods:

	Three Months Ended March 31,
	2014		2013
	(Millions)
Clean Air Division
Europe, South America & India
Restructuring and related expenses	$	8	$	1
Asia Pacific
Restructuring and related expenses	—		2
Total Clean Air Division	$	8	$	3
Ride Performance Division
Europe, South America & India
Restructuring and related expenses	2		1
Total Ride Performance Division	$	2	$	1

EBIT for the Clean Air division was $85 million in the first quarter of 2014 compared to $75 million in the first quarter a year ago. EBIT for North America increased $7 million to $56 million in the first quarter of 2014 versus the first quarter of 2013. EBIT benefited from higher light vehicle and off-highway revenue, ramp up on new platforms, operational cost improvements and positive currency, offset by higher engineering investments. Europe, South America and India's EBIT decreased $2 million in the first quarter of 2014 to $9 million from $11 million in the first quarter of 2013. The decrease was driven by higher restructuring and related expenses and negative currency, partially offset by higher OE revenue and new platforms in Europe and year-over-year restructuring savings. EBIT for Asia Pacific increased $5 million to $20 million in the first quarter of 2014 from $15 million in the first quarter of 2013. EBIT benefited from higher light vehicle production volumes, new platforms, higher commercial truck revenues in China, lower restructuring and related expenses and restructuring savings in Australia, partially offset by negative currency. For the Clean Air division, restructuring and related expenses of $8 million were included in EBIT for the first quarter of 2014 and $3 million for the same period in 2013. Currency had a $1 million unfavorable impact on EBIT of the Clean Air division for 2014 when compared to last year.

EBIT for the Ride Performance division was $53 million in the first quarter of 2014 compared to $39 million in the first quarter a year ago. EBIT for North America increased $5 million in the first quarter of 2014 to $30 million from $25 million in the first quarter of 2013. The benefits of increased light vehicle and commercial truck volumes and positive aftermarket product mix were partially offset by unfavorable currency. Europe, South America and India's EBIT was $16 million in the first quarter of 2014, compared to $10 million in the first quarter a year ago. The increase was driven by higher aftermarket revenues, increased light vehicle and commercial truck volumes in Europe and year-over-year restructuring savings, partially offset by higher restructuring costs and negative currency. EBIT for Asia Pacific increased $3 million to $7 million in the first quarter of

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2014 from $4 million in the first quarter of 2013. EBIT benefited from higher light vehicle production volumes in China and operational cost improvements, partially offset by negative currency. For the Ride Performance division, restructuring and related expenses of $2 million were included in EBIT for the first quarter of 2014 and $1 million for the same period in 2013. Currency had a $4 million unfavorable impact on EBIT of the Ride Performance division for 2014 when compared to last year. EBIT for the Ride Performance division also included a $7 million expense to adjust workers' compensation reserves.

Currency had a $5 million unfavorable impact on overall company EBIT for the first quarter of 2014 as compared to the prior year's first quarter.

EBIT as a Percentage of Revenue for the Three Months Ended March 31, 2014 and 2013

	Three Months Ended March 31,
	2014		2013
Clean Air Division
North America	8	%	8	%
Europe, South America & India	2	%	2	%
Asia Pacific	8	%	8	%
Total Clean Air Division	6	%	6	%
Ride Performance Division
North America	9	%	8	%
Europe, South America & India	6	%	4	%
Asia Pacific	13	%	8	%
Total Ride Performance Division	8	%	6	%
Total Tenneco Inc.	5	%	5	%

In the Clean Air division, EBIT as a percentage of revenues for the first quarter of 2014 was even compared to last year's first quarter. In North America, EBIT as a percentage of revenues for the first quarter of 2014 was even compared to last year's first quarter due to higher light vehicle and off-highway revenues, ramp up on new platforms, operational improvements and positive currency, offset by higher engineering investments. Europe, South America and India's EBIT as a percentage of revenues for the first quarter of 2014 was even compared to the prior year's first quarter due to higher OE revenue and new platforms in Europe and year-over-year restructuring savings, offset by higher restructuring and related expenses and negative currency. EBIT as a percentage of revenues for Asia Pacific in the first quarter of 2014 was even compared to the first quarter of 2013 due to a higher light vehicle production volumes, new platforms, higher commercial truck revenues in China, lower restructuring and related expenses and restructuring savings in Australia, offset by negative currency.

In the Ride Performance division, EBIT as a percentage of revenues was up two percent points compared to the prior year's first quarter. In the first quarter of 2014, EBIT as a percentage of revenues for North America was up one percentage point compared to the first quarter of 2013. The benefits of increased light vehicle and commercial truck volumes and positive aftermarket product mix were partially offset by unfavorable currency. EBIT as a percentage of revenues in Europe, South America and India was up two percentage points in the first quarter of 2014 when compared to the prior year's first quarter due to higher aftermarket revenues, increased light vehicle and commercial truck volumes in Europe and year-over-year restructuring savings, partially offset by higher restructuring costs and negative currency. In Asia Pacific, EBIT as a percentage of revenues for the first quarter of 2014 was up five percentage points from last year's first quarter due to higher light vehicle production volumes in China and operational cost improvements, partially offset by negative currency.

Interest Expense, Net of Interest Capitalized

We reported interest expense in the first quarter of 2014 of $19 million (all in our U.S. operations) net of interest capitalized of $1 million, down from $20 million ($19 million in our U.S. operations and $1 million in our foreign operations) net of interest capitalized of $1 million in the first quarter of 2013. Interest expense decreased by $1 million in the first quarter of 2014 compared to the prior year's first quarter.

On March 31, 2014, we had $733 million in long-term debt obligations that have fixed interest rates. Of that amount, $500 million is fixed through December 2020, $225 million is fixed through August 2018, and the remainder is fixed from 2015 through 2025. We also have $478 million in long-term debt obligations that are subject to variable interest rates. For more detailed explanations on our debt structure and senior credit facility refer to “Liquidity and Capital Resources — Capitalization” later in this Management’s Discussion and Analysis.

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Income Taxes

We reported income tax expense of $40 million and $12 million in the three month periods ended March 31, 2014 and 2013, respectively. The tax expense recorded in the first three months of 2013 included a net tax benefit of $13 million for tax adjustments primarily related to recognizing a U.S. tax benefit for foreign taxes and changes to prior year estimates. U.S. tax benefit for foreign taxes is driven by our ability to claim a U.S. foreign tax credit beginning in 2013. The U.S. foreign tax credit law provides for a credit against U.S. taxes otherwise payable for foreign taxes paid with regard to dividends, interest and royalties paid to us in the U.S.

In 2012, we reversed the tax valuation allowance against our net deferred tax assets in the U.S. based on operating improvements we had made, the outlook for light and commercial vehicle production in the U.S. and the positive impact this should have on our U.S. operations. We now have a federal net operating loss ("NOL") at March 31, 2014 of $5 million, which expires in 2030. We expect to fully utilize our federal NOL in 2014. The state NOLs expire in various tax years through 2032.

 The valuation allowances recorded against deferred tax assets will impact our provision for income taxes until the valuation allowances are released. Our provision for income taxes will include no tax benefit for losses incurred and no tax expense with respect to income generated in these jurisdictions until the respective valuation allowance is eliminated.

Restructuring and Other Charges

Over the past several years, we have adopted plans to restructure portions of our operations. These plans were approved by our Board of Directors and were designed to reduce operational and administrative overhead costs throughout the business. In 2013, we incurred $78 million in restructuring and related costs, primarily related to European cost reduction efforts including non-cash asset write downs of $3 million, our exit from the distribution of aftermarket exhaust products and ending production of leaf springs in Australia, headcount reductions in various regions, and the net impact of freezing our defined benefit plans in the United Kingdom, of which $70 million was recorded in cost of sales, $6 million in SG&A, $1 million in engineering expense and $1 million in other expense. In the first quarter of 2014, we incurred $10 million in restructuring and related costs, primarily related to European cost reduction efforts including non-cash asset write downs off $1 million, all of which was recorded in cost of sales. In the first quarter of 2013, we incurred $4 million in restructuring and related costs, primarily related to European cost reduction efforts and the costs to exit the distribution of aftermarket exhaust products in Australia, of which $3 million was recorded in cost of sales and $1 million of was recorded in SG&A.

Amounts related to activities that are part of our restructuring reserves are as follows:

	December 31, 2013 Restructuring Reserve		2014 Expenses	2014 Cash Payments	March 31, 2014 Restructuring Reserve
	(Millions)
Employee Severance, Termination Benefits and Other Related Costs	$	44	9	(5)	$	48

Under the terms of our senior credit agreement, we are allowed to exclude $80 million of cash charges and expenses, before taxes, related to cost reduction initiatives incurred after March 22, 2012 from the calculation of the financial covenant ratios required under our senior credit facility. As of December 31, 2013, we had excluded all allowable charges relating to restructuring initiatives against the $80 million available under the terms of the senior credit facility.

On January 31, 2013, we announced our intent to reduce structural costs in Europe by approximately $60 million annually, and anticipate related costs of approximately $120 million, which includes the closing of the Vittaryd facility in Sweden that we announced in September 2012 and a $7 million charge recorded in the fourth quarter of 2012 related to the impairment of certain assets in the European ride performance business. The $120 million of anticipated costs includes approximately $20 million of non-cash asset write downs, the cost of relocating tooling, equipment and production to other facilities, severance and retention payments to employees and other costs related to these actions. Any plans affecting our European hourly and salaried workforce would be subject to consultation with the relevant employee representatives. We incurred $78 million in restructuring and related costs in 2013, of which $69 million was related to this initiative including $3 million for non-cash asset write downs. In the first quarter of 2014, we incurred $10 million in restructuring and related costs, all of which was related to this initiative including $1 million for non-cash asset write downs. We expect that most of the remaining expense will be recorded in 2014, and that the Company will reach a full savings run rate in 2016. As part of our European structural cost reduction initiative, on September 5, 2013 we announced our intent to close our ride performance plant in Gijon, Spain and reduce the workforce at our ride performance plant in Sint-Truiden, Belgium. The actions were subject to consultation with the relevant employee representatives and in total would eliminate approximately 480 jobs in

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Western Europe while allowing the most efficient use of our capital assets and production capacity across the region. We concluded the consultation period with employee representatives at Gijon without having reached agreement and on December 17, 2013 notified the Gijon employees' works council that the Company was proceeding with the plant closure. Employee terminations at Gijon were completed by the end of 2013. During the first quarter of 2014, the employees' works council filed suit challenging the decision to close the Gijon plant and local High Court of Justice of Asturias ruled in favor of the employees' works council. On February 25, 2014, we announced the intention of the Company to appeal that decision to the Supreme Court of Spain in Madrid, and at the same time we are working closely with local and European government officials to reach a solution that will address the challenge to our restructuring plan by the Gijon plant's employees' works council. Negotiations with employee representatives at Sint-Truiden are continuing. Our estimate of total charges related to the actions at the Gijon and Sint-Truiden plants remains unchanged from what was announced previously. We expect total charges of $63 million related to these actions, $57 million of cash expenditures (which consist of severance and related payments to employees, the cost of relocating tooling, equipment and production to other facilities and other costs related to these actions) and $6 million of non-cash asset write downs. We recorded $60 million in 2013 and $2 million in the first quarter of 2014 related to these actions at Gijon and Sint-Truiden. In the first quarter of 2014, we announced and finalized the closure of the clean air just-in-time plant in Iwuy, France, due to reduced demand for the plant's products. The actions were subject to the required consultation process with the relevant employee representatives.

Earnings Per Share

We reported net income attributable to Tenneco Inc. of $46 million or $0.75 per diluted common share for the first quarter of 2014. Included in the results for the first quarter of 2014 were negative impacts from expenses related to our restructuring activities. The net impact of these items decreased earnings per diluted share by $0.16. We reported net income attributable to Tenneco Inc. of $54 million or $0.88 per diluted common share for the first quarter of 2013. Included in the results for the first quarter of 2013 were negative impacts from expenses related to our restructuring activities, which were more than offset by net tax benefits. The net impact of these items increased earnings per diluted share by $0.16.

Dividends on Common Stock

On January 10, 2001, our Board of Directors eliminated the quarterly dividend on our common stock. There are no current plans to reinstate a dividend on our common stock.

Cash Flows for the Three Months Ended March 31, 2014 and 2013

	Three Months Ended March 31,
	2014			2013
	(Millions)
Cash provided (used) by:
Operating activities	$	(140	)	$	(92	)
Investing activities	(91		)	(83		)
Financing activities	229			178

Operating Activities

For the first quarter of 2014, operating activities used $140 million in cash compared to $92 million in cash used during last year’s first quarter. Compared to the prior year, the greater use of cash from operations was primarily driven by working capital investment to support business growth. For the first quarter of 2014, cash used for working capital was $244 million versus $197 million of cash used for working capital in the first quarter of 2013. Receivables were a use of cash of $234 million in the first quarter of 2014 compared to a use of cash of $176 million in the prior year’s first quarter. Inventory represented a cash outflow of $81 million during the first quarter of 2014, compared to a cash outflow of $40 million for last year’s first quarter. Accounts payable provided $87 million of cash for the quarter ended March 31, 2014, compared to cash provided of $77 million for the quarter ended March 31, 2013. Cash taxes were $21 million for the first quarter of 2014 compared to $25 million in the prior year’s first quarter.

Investing Activities

Cash used for investing activities was $91 million in the first quarter of 2014 compared to cash used of $83 million in the same period a year ago. Cash payments for plant, property and equipment were $83 million in the first quarter of 2014 versus payments of $70 million in the first quarter of 2013, an increase of $13 million. The majority of the spending was to support continued growth in the Clean Air business. Cash payments for software-related intangible assets were $7 million and $6 million, respectively, for the first quarters of 2014 and 2013. Changes in restricted cash were a use of cash of $1 million and $9 million in the first quarter of 2014 and 2013, respectively.

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Financing Activities

Cash flow from financing activities was an inflow of $229 million for the quarter ending March 31, 2014 compared to an inflow of $178 million for the quarter ending March 31, 2013. Borrowings under our revolving credit facility were $251 million at March 31, 2014 and $280 million at March 31, 2013. At March 31, 2014, there was $30 million borrowed under the North American accounts receivable securitization programs, whereas at March 31, 2013, there was $50 million outstanding.

Outlook

For the second quarter, IHS forecasts global light vehicle production to increase two percent year-over-year in the regions where we operate. This includes IHS estimates of year-over-year increases in North America (two percent), China (11 percent) and India (six percent). Europe is forecasted to be down one percent, South America down 26 percent and Australia is expected to decrease three percent.

We expect to outpace global light vehicle production in the second quarter with our strong platform position globally. Commercial truck and off-highway equipment revenue is expected to increase consistent with the full-year revenue growth estimate of 20 percent to 30 percent, driven by new business and incremental content launching on current platforms. We also expect steady performance from our global aftermarket business, up slightly in the second quarter versus last year with some growth in North America and Europe.

Critical Accounting Policies

We prepare our condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America. Preparing our condensed consolidated financial statements in accordance with generally accepted accounting principles requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The following paragraphs include a discussion of some critical areas where estimates are required.

Revenue Recognition

We recognize revenue for sales to our original equipment and aftermarket customers when title and risk of loss passes to the customers under the terms of our arrangements with those customers, which is usually at the time of shipment from our plants or distribution centers. Generally, in connection with the sale of exhaust systems to certain original equipment manufacturers, we purchase catalytic converters and diesel particulate filters or components thereof including precious metals (“substrates”) on behalf of our customers which are used in the assembled system. These substrates are included in our inventory and “passed through” to the customer at our cost, plus a small margin, since we take title to the inventory and are responsible for both the delivery and quality of the finished product. Revenues recognized for substrate sales were $484 million and $454 million for the first three months of 2014 and 2013, respectively. For our aftermarket customers, we provide for promotional incentives and returns at the time of sale. Estimates are based upon the terms of the incentives and historical experience with returns. Certain taxes assessed by governmental authorities on revenue producing transactions, such as value added taxes, are excluded from revenue and recorded on a net basis. Shipping and handling costs billed to customers are included in revenues and the related costs are included in cost of sales in our condensed consolidated statements of income.

Warranty Reserves

Where we have offered product warranty, we also provide for warranty costs. Provisions for estimated expenses related to product warranty are made at the time products are sold or when specific warranty issues are identified on OE products. These estimates are established using historical information about the nature, frequency, and average cost of warranty claims and upon specific warranty issues as they arise. The warranty terms vary but range from one year up to limited lifetime warranties on some of our premium aftermarket products. We actively study trends of our warranty claims and take action to improve product quality and minimize warranty claims. While we have not experienced any material differences between these estimates and our actual costs, it is reasonably possible that future warranty issues could arise that could have a significant impact on our condensed consolidated financial statements.

Pre-production Design and Development and Tooling Assets

We expense pre-production design and development costs as incurred unless we have a contractual guarantee for reimbursement from the original equipment customer. Unbilled pre-production design and development costs recorded in prepayments and other and long-term receivables totaled $33 million and $30 million at March 31, 2014 and December 31, 2013, respectively. In addition, plant, property and equipment included $63 million and $59 million at March 31, 2014 and December 31, 2013, respectively, for original equipment tools and dies that we own, and prepayments and other included $100 million and $86 million at March 31, 2014 and December 31, 2013, respectively, for in-process tools and dies that we are building for our original equipment customers.

Income Taxes

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We recognize deferred tax assets and liabilities on the basis of the future tax consequences attributable to temporary differences that exist between the financial statement carrying value of assets and liabilities and their respective tax values, and net operating losses ("NOL") and tax credit carryforwards on a taxing jurisdiction basis. We measure deferred tax assets and liabilities using enacted tax rates that will apply in the years in which we expect the temporary differences to be recovered or paid.

We evaluate our deferred income taxes quarterly to determine if valuation allowances are required or should be adjusted. U.S. GAAP requires that companies assess whether valuation allowances should be established against their deferred tax assets based on consideration of all available evidence, both positive and negative, using a "more likely than not" standard. This assessment considers, among other matters, the nature, frequency and amount of recent losses, the duration of statutory carryforward periods, and tax planning strategies. In making such judgments, significant weight is given to evidence that can be objectively verified.

Valuation allowances are established for deferred tax assets based on a “more likely than not” threshold. The ability to realize deferred tax assets depends on our ability to generate sufficient taxable income within the carryforward periods provided for in the tax law for each tax jurisdiction. We have considered the following possible sources of taxable income when assessing the realization of our deferred tax assets:

• Future reversals of existing taxable temporary differences;

• Taxable income or loss, based on recent results, exclusive of reversing temporary differences and carryforwards;

• Tax-planning strategies; and

• Taxable income in prior carryback years if carryback is permitted under the relevant tax law.

The valuation allowances recorded against deferred tax assets generated by taxable losses in Spain and certain other foreign jurisdictions will impact our provision for income taxes until the valuation allowances are released. Our provision for income taxes will include no tax benefit for losses incurred and no tax expense with respect to income generated in these jurisdictions until the respective valuation allowance is eliminated.

For interim tax reporting we estimate our annual effective tax rate and apply it to our year to date ordinary income. Jurisdictions with a projected loss for the year or an actual year-to-date loss where no tax benefit can be recognized due to a valuation allowance are excluded from the estimated annual effective tax rate. The impact of including these jurisdictions on the quarterly effective rate calculation could result in a higher or lower effective tax rate during a particular quarter due to the mix and timing of actual earnings versus annual projections. The tax effects of certain unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are excluded from the estimated annual effective tax rate calculation and recognized in the interim period in which they occur.

Goodwill, net

We evaluate goodwill for impairment in the fourth quarter of each year, or more frequently if events indicate it is warranted. The goodwill impairment test consists of a two-step process. In step one, we compare the estimated fair value of our reporting units with goodwill to the carrying value of the unit’s assets and liabilities to determine if impairment exists within the recorded balance of goodwill. We estimate the fair value of each reporting unit using the income approach which is based on the present value of estimated future cash flows. The income approach is dependent on a number of factors, including estimates of market trends, forecasted revenues and expenses, capital expenditures, weighted average cost of capital and other variables. A separate discount rate derived by a combination of published sources, internal estimates and weighted based on our debt and equity structure, was used to calculate the discounted cash flows for each of our reporting units. These estimates are

based on assumptions that we believe to be reasonable, but which are inherently uncertain and outside of the control of management. If the carrying value of the reporting unit is higher than its fair value, there is an indication that impairment may exist which requires step two to be performed to measure the amount of the impairment loss. The amount of impairment is determined by comparing the implied fair value of a reporting unit’s goodwill to its carrying value.

In the fourth quarter of 2013, the estimated fair value of each of our reporting units exceeded the carrying value of their assets and liabilities as of the testing date.

Pension and Other Postretirement Benefits

We have various defined benefit pension plans that cover some of our employees. We also have postretirement health care and life insurance plans that cover some of our domestic employees. Our pension and postretirement health care and life insurance expenses and valuations are dependent on assumptions used by our actuaries in calculating those amounts. These assumptions include discount rates, health care cost trend rates, long-term return on plan assets, retirement rates, mortality rates and other factors. Health care cost trend rate assumptions are developed based on historical cost data and an assessment of likely long-term trends. Retirement rates are based primarily on actual plan experience while mortality rates are based upon the general population experience which is not expected to differ materially from our experience.

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Our approach to establishing the discount rate assumption for both our domestic and foreign plans is generally based on the yield on high-quality corporate fixed-income investments. At the end of each year, the discount rate is determined using the results of bond yield curve models based on a portfolio of high quality bonds matching the notional cash inflows with the expected benefit payments for each significant benefit plan. Based on this approach, we raised the weighted average discount rate for all our pension plans to 4.6 percent in 2014 from 4.1 percent in 2013. The discount rate for postretirement benefits was raised to 4.8 percent in 2014 from 4.1 percent in 2013.

Our approach to determining expected return on plan asset assumptions evaluates both historical returns as well as estimates of future returns, and is adjusted for any expected changes in the long-term outlook for the equity and fixed income markets. As a result, our estimate of the weighted average long-term rate of return on plan assets for all of our pension plans remained unchanged at 6.9 percent for 2014.

Except in the U.K., our pension plans generally do not require employee contributions. Our policy is to fund our pension plans in accordance with applicable U.S. and foreign government regulations and to make additional payments as funds are available to achieve full funding of the accumulated benefit obligation. As of March 31, 2014, all legal funding requirements have been met.

New Accounting Pronouncements

Note 11 in our notes to condensed consolidated financial statements located in Part I Item 1 of this Form 10-Q is incorporated herein for reference.

Liquidity and Capital Resources

Capitalization

	March 31, 2014		December 31, 2013		% Change
	(Millions)
Short-term debt and maturities classified as current	$	106	$	83	28	%
Long-term debt	1,209		1,019		19
Total debt	1,315		1,102		19
Total redeemable noncontrolling interests	25		20		25
Total noncontrolling interests	42		39		8
Tenneco Inc. shareholders’ equity	491		433		13
Total equity	533		472		13
Total capitalization	$	1,873	$	1,594	18

General. Short-term debt, which includes maturities classified as current, borrowings by foreign subsidiaries, and borrowings securitized by our North American accounts receivable securitization program, was $106 million and $83 million as of March 31, 2014 and December 31, 2013, respectively. Borrowings under our revolving credit facilities, which are classified as long-term debt, were $251 million and $58 million at March 31, 2014 and December 31, 2013, respectively.

The 2014 year-to-date increase in Tenneco Inc. shareholders' equity primarily resulted from net income attributable to Tenneco Inc. of $46 million, a $3 million increase related to pension and postretirement benefits, a $15 million increase in premium on common stock and other capital surplus relating to common stock issued pursuant to benefit plans, partially offset by a $6 million decrease caused by the impact of changes in foreign exchange rates on the translation of financial statements of our foreign subsidiaries into U.S. dollars.

Overview. Our financing arrangements are primarily provided by a committed senior secured financing arrangement with a syndicate of banks and other financial institutions. The arrangement is secured by substantially all our domestic assets and pledges of up to 66 percent of the stock of certain first-tier foreign subsidiaries, as well as guarantees by our material domestic subsidiaries.

On March 22, 2012, we completed an amendment and restatement of our senior credit facility by increasing the amount and extending the maturity date of our revolving credit facility and adding a new Tranche A Term Facility. As of March 31, 2014, the senior credit facility provides us with a total revolving credit facility size of $850 million and had a $225 million balance outstanding under the Tranche A Term Facility, both of which will mature on March 22, 2017. Funds may be borrowed, repaid and re-borrowed under the revolving credit facility without premium or penalty. The revolving credit facility is reflected as debt on our balance sheet only if we borrow money under this facility or if we use the facility to make payments for letters of credit. Outstanding letters of credit reduce our availability to enter into revolving loans under the facility. We are required to make quarterly principal payments under the Tranche A Term Facility of $6.3 million beginning June 30, 2014 through March 31, 2015, $9.4 million beginning June 30, 2015 through March 31, 2016, $12.5 million beginning June 30, 2016 through

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December 31, 2016 and a final payment of $125 million is due on March 22, 2017. We have excluded the required payments, within the next twelve months, under the Tranche A Term Facility totaling $25 million from current liabilities as of March 31, 2014, because we have the intent and ability to refinance the obligations on a long-term basis by using our revolving credit facility.

At March 31, 2014, of the $850 million available under the revolving credit facility, we had unused borrowing capacity of $562 million with $251 million in outstanding borrowings and $37 million in outstanding letters of credit. As of March 31, 2014, our outstanding debt also included $225 million related to our Tranche A Term Facility which is subject to quarterly principal payments as described above through March 22, 2017, $225 million of 7.75 percent senior notes due August 15, 2018, $500 million of 6.875 percent senior notes due December 15, 2020, and $114 million of other debt.

Senior Credit Facility — Interest Rates and Fees. Beginning March 22, 2012, our Tranche A Term Facility and revolving credit facility bear interest at an annual rate equal to, at our option, either (i) London Interbank Offered Rate (“LIBOR”) plus a margin of 250 basis points, or (ii) a rate consisting of the greater of (a) the JPMorgan Chase prime rate plus a margin of 150 basis points, (b) the Federal Funds rate plus 50 basis points plus a margin of 150 basis points, and (c) the Eurodollar Rate plus 100 basis points plus a margin of 150 basis points. The margin we pay on these borrowings will be reduced by a total of 25 basis points below the original margin following each fiscal quarter for which our consolidated net leverage ratio is less than 1.50 or will be increased by a total of 25 basis points above the original margin if our consolidated net leverage ratio is greater than or equal to 2.50. We also pay a commitment fee equal to 40 basis points. In February 2014, the margin we pay on borrowing decreased by 25 basis points below the original margin, as a result of a decrease in our consolidated net leverage ratio to1.39 at December 31, 2013. As of March 31, 2014, our net leverage ratio was 1.63 resulting in an increase of 25 basis points back to 250 basis points.

Senior Credit Facility — Other Terms and Conditions. Our senior credit facility requires that we maintain financial ratios equal to or better than the following consolidated net leverage ratio (consolidated indebtedness net of cash divided by consolidated EBITDA, as defined in the senior credit facility agreement), and consolidated interest coverage ratio (consolidated EBITDA divided by consolidated interest expense, as defined under the senior credit facility agreement) at the end of each period indicated. Failure to maintain these ratios will result in a default under our senior credit facility. The financial ratios required under the amended and restated senior credit facility and, the actual ratios we achieved for the first quarter of 2014, are as follows:

	March 31, 2014
	Required	Actual
Leverage Ratio (maximum)	3.50	1.63
Interest Coverage Ratio (minimum)	2.75	10.39

The senior credit facility includes a maximum leverage ratio covenant of 3.50 and a minimum interest coverage ratio of 2.75 through March 22, 2017.

The covenants in our senior credit facility agreement generally prohibit us from repaying or refinancing our senior notes. So long as no default existed, we would, however, under our senior credit facility agreement, be permitted to repay or refinance our senior notes (i) with the net cash proceeds of permitted refinancing indebtedness (as defined in the senior credit facility agreement or with the net cash proceeds of our common stock); (ii) with the net cash proceeds of the incremental facilities (as defined in the senior credit facility agreement); (iii) with the net cash proceeds of the revolving loans (as defined in the senior credit facility agreement); (iv) with the cash generated by the operations of the Company; (v) in an amount equal to the net cash proceeds of qualified capital stock (as defined in the senior credit facility agreement) issued by the Company after March 22, 2012; and (vi) in exchange for permitted refinancing indebtedness or in exchange for shares of our common stock; provided that such purchases are capped as follows (with respect to clauses (iii), (iv) and (v) on a pro forma consolidated leverage ratio after giving effect to such purchase, cancellation or redemption):

Pro forma Consolidated Leverage Ratio	Aggregate Senior Note Maximum Amount
	(Millions)
Greater than or equal to 3.0x	$	20
Greater than or equal to 2.5x	$	100
Greater than or equal to 2.0x	$	200
Less than 2.0x	no limit

Although the senior credit facility agreement would permit us to repay or refinance our senior notes under the conditions described above, any repayment or refinancing of our outstanding notes would be subject to market conditions and either the voluntary participation of note holders or our ability to redeem the notes under the terms of the applicable note indenture. For

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example, while the senior credit agreement would allow us to repay our outstanding notes via a direct exchange of the notes for either permitted refinancing indebtedness or for shares of our common stock, we do not, under the terms of the agreements governing our outstanding notes, have the right to refinance the notes via any type of direct exchange.

The senior credit facility agreement also contains other restrictions on our operations that are customary for similar facilities, including limitations on: (i) incurring additional liens; (ii) sale and leaseback transactions (except for the permitted transactions as described in the senior credit facility agreement); (iii) liquidations and dissolutions; (iv) incurring additional indebtedness or guarantees; (v) investments and acquisitions; (vi) dividends and share repurchases; (vii) mergers and consolidations; and (viii) refinancing of the senior notes. Compliance with these requirements and restrictions is a condition for any incremental borrowings under the senior credit facility agreement and failure to meet these requirements enables the lenders to require repayment of any outstanding loans.

As of March 31, 2014, we were in compliance with all the financial covenants and operational restrictions of the senior credit facility. Our senior credit facility does not contain any terms that could accelerate payment of the facility or affect pricing under the facility as a result of a credit rating agency downgrade.

Senior Notes. As of March 31, 2014, our outstanding senior notes also included $225 million of 7.75 percent senior notes due August 15, 2018 and $500 million of 6.875 percent senior notes due December 15, 2020. Under the indentures governing the notes, we are permitted to redeem some or all of the remaining senior notes at specified prices that decline to par over a specified period at any time on and after August 15, 2014 in the case of the senior notes due 2018, and December 15, 2015 in the case of the senior notes due 2020. In addition, prior to such dates the notes may also be redeemed at a price generally equal to 100 percent of the principal amount thereof plus a premium based on the present values of the remaining payments due to the noteholders. If we sell certain of our assets or experience specified kinds of changes in control, we must offer to repurchase the notes due 2018 and 2020 at 101 percent of the principal amount thereof plus accrued and unpaid interest.

Our senior notes require that, as a condition precedent to incurring certain types of indebtedness not otherwise permitted, our consolidated fixed charge coverage ratio, as calculated on a pro forma basis, be greater than 2.00. The indentures also contain restrictions on our operations, including limitations on: (i) incurring additional indebtedness or liens; (ii) dividends; (iii) distributions and stock repurchases; (iv) investments; (v) asset sales and (vi) mergers and consolidations. Subject to limited exceptions, all of our existing and future material domestic wholly owned subsidiaries fully and unconditionally guarantee these notes on a joint and several basis. There are no significant restrictions on the ability of the subsidiaries that have guaranteed these notes to make distributions to us. As of March 31, 2014, we were in compliance with the covenants and restrictions of these indentures.

Accounts Receivable Securitization. We securitize some of our accounts receivable on a limited recourse basis in North America and Europe. As servicer under these accounts receivable securitization programs, we are responsible for performing all accounts receivable administration functions for these securitized financial assets including collections and processing of customer invoice adjustments. In North America, we have an accounts receivable securitization program with three commercial banks comprised of a first priority facility and a second priority facility. We securitize original equipment and aftermarket receivables on a daily basis under the bank program. In March 2014, the North American program was amended and extended to March 20, 2015. The first priority facility continues to provide financing of up to $110 million and the second priority facility, which is subordinated to the first priority facility, continues to provide up to an additional $40 million of financing. Both facilities monetize accounts receivable generated in the U.S. and Canada that meet certain eligibility requirements. The second priority facility also monetizes certain accounts receivable generated in the U.S. or Canada that would otherwise be ineligible under the first priority securitization facility. The amount of outstanding third-party investments in our securitized accounts receivable under the North American program was $30 million at March 31, 2014 and $10 million at December 31, 2013.

Each facility contains customary covenants for financings of this type, including restrictions related to liens, payments, mergers or consolidations and amendments to the agreements underlying the receivables pool. Further, each facility may be terminated upon the occurrence of customary events (with customary grace periods, if applicable), including breaches of covenants, failure to maintain certain financial ratios, inaccuracies of representations and warranties, bankruptcy and insolvency events, certain changes in the rate of default or delinquency of the receivables, a change of control and the entry or other enforcement of material judgments. In addition, each facility contains cross-default provisions, where the facility could be terminated in the event of non-payment of other material indebtedness when due and any other event which permits the acceleration of the maturity of material indebtedness.

We also securitize receivables in our European operations with regional banks in Europe under various separate facilities. The commitments for these arrangements are generally for one year, but some may be cancelled with notice 90 days prior to renewal. In some instances, the arrangement provides for cancellation by the applicable financial institution at any time upon 15 days, or less, notification. The amount of outstanding third-party investments in our securitized accounts receivable in Europe was $175 million and $134 million at March 31, 2014 and December 31, 2013, respectively.

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If we were not able to securitize receivables under either the North American or European securitization programs, our borrowings under our revolving credit agreement might increase. These accounts receivable securitization programs provide us with access to cash at costs that are generally favorable to alternative sources of financing, and allow us to reduce borrowings under our revolving credit agreement.

In our North American accounts receivable securitization programs, we transfer a partial interest in a pool of receivables and the interest that we retain is subordinate to the transferred interest. Accordingly, we account for our North American securitization program as a secured borrowing. In our European programs, we transfer accounts receivables in their entirety to the acquiring entities and satisfy all of the conditions established under ASC Topic 860, “Transfers and Servicing,” to report the transfer of financial assets in their entirety as a sale. The proceeds received in exchange for the transfer of accounts receivable under our European securitization programs approximates the fair value of such receivables. We recognized less than $1 million interest expense in each of the three month periods ended March 31, 2014 and 2013, respectively, relating to our North American securitization program. In addition, we recognized a loss of $1 million in each of the three month periods ended March 31, 2014 and 2013, respectively, on the sale of trade accounts receivable in our European accounts receivable securitization programs, representing the discount from book values at which these receivables were sold to our banks. The discount rate varies based on funding costs incurred by our banks, which averaged approximately three percent during both the first three months of 2014 and 2013, respectively.

Negotiable Financial Instruments. One of our European subsidiaries receives payment from one of its customers whereby the accounts receivable are satisfied through the delivery of negotiable financial instruments. We may collect these financial instruments before their maturity date by either selling them at a discount or using them to satisfy accounts receivable that have previously been sold to a European bank. Any of these financial instruments which are not sold are classified as other current assets. The amount of these financial instruments that was collected before their maturity date and sold at a discount totaled $6 million and $5 million at March 31, 2014 and December 31, 2013, respectively. No negotiable financial instruments were held by our European subsidiary as of March 31, 2014 or December 31, 2013.

In certain instances, several of our Chinese subsidiaries receive payment from customers and satisfy vendor payments through the receipt and delivery of negotiable financial instruments. Financial instruments issued to satisfy vendor payables and not redeemed totaled $21 million and $13 million at March 31, 2014 and December 31, 2013, respectively, and were classified as notes payable. Financial instruments received from customers and not redeemed totaled $20 million and $12 million at March 31, 2014 and December 31, 2013, respectively. We classify financial instruments received from our customers as other current assets if issued by a financial institution of our customers or as customer notes and accounts, net if issued by our customer. We classified $20 million and $12 million in other current assets at March 31, 2014 and December 31, 2013, respectively. Some of our Chinese subsidiaries that issue their own negotiable financial instruments to pay vendors are required to maintain a cash balance if they exceed certain credit limits with the financial institution that guarantees those financial instruments. A restricted cash balance was required at those Chinese subsidiaries at March 31, 2014 for less than $1 million and was not required December 31, 2013.

The negotiable financial instruments received by one of our European subsidiaries and some of our Chinese subsidiaries are checks drawn by our customers and guaranteed by their banks that are payable at a future date. The use of these instruments for payment follows local commercial practice. Because negotiable financial instruments are financial obligations of our customers and are guaranteed by our customers’ banks, we believe they represent a lower financial risk than the outstanding accounts receivable that they satisfy which are not guaranteed by a bank.

Supply Chain Financing. Near the end of the second quarter of 2013 certain of our suppliers in the U.S. extended their payment terms to Tenneco. The liquidity benefit to Tenneco from the extended payment terms totaled $11 million at March 31, 2014. These suppliers also began participating in a supply chain financing program under which they securitize their accounts receivables from Tenneco with two financial institutions. The financial institutions participate in the supply chain financing program on an uncommitted basis and can cease purchasing receivables from Tenneco's suppliers at any time. If the financial institutions did not continue to purchase receivables from Tenneco's suppliers under this program, the participating vendors could reduce their payment terms to Tenneco which in turn would cause our borrowings under our revolving credit facility to increase.

Capital Requirements. We believe that cash flows from operations, combined with our cash on hand and available borrowing capacity described above, assuming that we maintain compliance with the financial covenants and other requirements of our loan agreement, will be sufficient to meet our future capital requirements, including debt amortization, capital expenditures, pension contributions, and other operational requirements including cost reduction plans, for the following year. Our ability to meet the financial covenants depends upon a number of operational and economic factors, many of which are beyond our control. In the event that we are unable to meet these financial covenants, in addition to seeking an amendment to our senior credit facility, we would consider several options to meet our cash flow needs. Such actions include additional restructuring initiatives and other cost reductions, sales of assets, reductions to working capital and capital spending, issuance

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of equity and other alternatives to enhance our financial and operating position. Should we be required to implement any of these actions to meet our cash flow needs, we believe we can do so in a reasonable time frame.

Derivative Financial Instruments

Foreign Currency Exchange Rate Risk

We use derivative financial instruments, principally foreign currency forward purchase and sale contracts with terms of less than one year, to hedge our exposure to changes in foreign currency exchange rates. Our primary exposure to changes in foreign currency rates results from intercompany loans made between affiliates to minimize the need for borrowings from third parties. Additionally, we enter into foreign currency forward purchase and sale contracts to mitigate our exposure to changes in exchange rates on certain intercompany and third-party trade receivables and payables. We manage counter-party credit risk by entering into derivative financial instruments with major financial institutions that can be expected to fully perform under the terms of such agreements. We do not enter into derivative financial instruments for speculative purposes.

In managing our foreign currency exposures, we identify and aggregate existing offsetting positions and then hedge residual exposures through third-party derivative contracts. The fair value of our foreign currency forward contracts was$1 million at March 31, 2014 and is based on an internally developed model which incorporates observable inputs including quoted spot rates, forward exchange rates and discounted future expected cash flows utilizing market interest rates with similar quality and maturity characteristics. The following table summarizes by major currency the notional amounts for our foreign currency forward purchase and sale contracts as of March 31, 2014. All contracts in the following table mature in 2014.

		March 31, 2014
		Notional Amount in Foreign Currency
		(Millions)
Australian dollars	—Purchase	2
British pounds	—Purchase	31
	—Sell	(5	)
Canadian dollars	—Purchase	12
	—Sell	(2	)
European euro	—Purchase	8
	—Sell	(15	)
South African rand	—Purchase	222
Japanese yen	—Purchase	196
	—Sell	(461	)
Polish zloty	—Purchase	21
U.S. dollars	—Purchase	16
	—Sell	(84	)

Interest Rate Risk

Our financial instruments that are sensitive to market risk for changes in interest rates are primarily our debt securities. We use our revolving credit facility to finance our short-term and long-term capital requirements. We pay a current market rate of interest on these borrowings. Our long-term capital requirements have been financed with long-term debt with original maturity dates ranging from five to ten years. On March 31, 2014, we had $733 million in long-term debt obligations that have fixed interest rates. Of that amount, $500 million is fixed through December 2020, $225 million is fixed through August 2018, and the remainder is fixed from 2015 through 2026. We also have $478 million in long-term debt obligations that are subject to variable interest rates. For more detailed explanations on our debt structure and senior credit facility refer to “Liquidity and Capital Resources — Capitalization” earlier in this Management’s Discussion and Analysis.

We estimate that the fair value of our long-term debt at March 31, 2014 was about 105 percent of its book value. A one percentage point increase or decrease in interest rates would increase or decrease the annual interest expense we recognize in the income statement and the cash we pay for interest expense by about $6 million.

Environmental Matters, Legal Proceedings and Product Warranties

We are involved in environmental remediation matters, legal proceedings, claims, investigations and warranty obligations. These matters are typically incidental to the conduct of our business and create the potential for contingent losses. We accrue for potential contingent losses when our review of available facts indicates that it is probable a loss has been incurred and the amount of the loss is reasonably estimable. Each quarter we assess our loss contingencies based upon currently

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available facts, existing technology, and presently enacted laws and regulations taking into consideration the likely effects of inflation and other societal and economic factors and record adjustments to these reserves as required. As an example, we consider all available evidence, including prior experience in remediation of contaminated sites, other companies’ cleanup experiences and data released by the United States Environmental Protection Agency or other organizations when we evaluate our environmental remediation contingencies. Further, all of our loss contingency estimates are subject to revision in future periods based on actual costs or new information. With respect to our environmental liabilities, where future cash flows are fixed or reliably determinable, we have discounted those liabilities. We evaluate recoveries separately from the liability and, when they are assured, recoveries are recorded and reported separately from the associated liability in our consolidated financial statements.

Environmental Matters

We are subject to a variety of environmental and pollution control laws and regulations in all jurisdictions in which we operate. We expense or capitalize, as appropriate, expenditures for ongoing compliance with environmental regulations that relate to current operations. We expense costs related to an existing condition caused by past operations that do not contribute to current or future revenue generation. As of March 31, 2014, we have the obligation to remediate or contribute towards the remediation of certain sites, including one Federal Superfund site. At March 31, 2014, our aggregated estimated share of environmental remediation costs for all these sites on a discounted basis was approximately $15 million, of which $3 million is recorded in other current liabilities and $12 million is recorded in deferred credits and other liabilities in our condensed consolidated balance sheet. For those locations where the liability was discounted, the weighted average discount rate used was 2.50 percent. The undiscounted value of the estimated remediation costs was $19 million. Our expected payments of environmental remediation costs are estimated to be approximately $3 million in 2014, $1 million in 2015, $1 million each year beginning 2016 through 2018 and $12 million in aggregate thereafter.

Based on information known to us, we have established reserves that we believe are adequate for these costs. Although we believe these estimates of remediation costs are reasonable and are based on the latest available information, the costs are estimates and are subject to revision as more information becomes available about the extent of remediation required. At some sites, we expect that other parties will contribute to the remediation costs. In addition, certain environmental statutes provide that our liability could be joint and several, meaning that we could be required to pay in excess of our share of remediation costs. Our understanding of the financial strength of other potentially responsible parties at these sites has been considered, where appropriate, in our determination of our estimated liability. We do not believe that any potential costs associated with our current status as a potentially responsible party in the Federal Superfund site, or as a liable party at the other locations referenced herein, will be material to our consolidated financial position, results of operations, or liquidity.

Antitrust Investigations

On March 25, 2014, representatives of the European Commission were at Tenneco GmbH's Edenkoben, Germany administrative facility to gather information in connection with an ongoing global antitrust investigation concerning multiple automotive suppliers. On March 25, 2014, we also received a related subpoena from the U.S. Department of Justice. We have cooperated and continue to cooperate fully with these antitrust investigations, and take other actions to minimize our potential exposure. Antitrust law investigations and related matters often continue for several years and can result in significant penalties and liability. At this point, we cannot estimate the ultimate impact on our company from investigations into our antitrust compliance and related matters in light of the uncertainties and many variables involved, and there can be no assurance that the ultimate resolution of these matters will not have a material adverse effect on our consolidated financial position, results of operations or liquidity.

Other Legal Proceedings, Claims and Investigations

We also from time to time are involved in other legal proceedings, claims or investigations. Some of these matters involve allegations of damages against us relating to environmental liabilities (including toxic tort, property damage and remediation), intellectual property matters (including patent, trademark and copyright infringement, and licensing disputes), personal injury claims (including injuries due to product failure, design or warning issues, and other product liability related matters), taxes, employment matters, and commercial or contractual disputes, sometimes related to acquisitions or divestitures. Additionally, some of these matters involve allegations relating to legal compliance. For example, one of our Argentine subsidiaries is currently defending against a criminal complaint alleging the failure to comply with laws requiring the proceeds of export transactions to be collected, reported and/or converted to local currency within specified time periods. As another example, in the U.S. we are subject to an audit in 11 states with respect to the payment of unclaimed property to those states, spanning a period as far back as over 30 years. While we vigorously defend ourselves against all of these legal proceedings, claims, and investigations and take other actions to minimize our potential exposure, in future periods, we could be subject to cash costs or charges to earnings if any of these matters are resolved on unfavorable terms. Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on current information, including our assessment of the merits of the particular claim, except as described above under "Antitrust Investigations," we do not expect the legal proceedings, claims or

47

investigations currently pending against us will have any material adverse impact on our consolidated financial position, results of operations or liquidity.

In addition, we are subject to lawsuits initiated by a significant number of claimants alleging health problems as a result of exposure to asbestos. In the early 2000's we were named in nearly 20,000 complaints, most of which were filed in Mississippi state court and the vast majority of which made no allegations of exposure to asbestos from our product categories. Most of these claims have been dismissed and our current docket of active and inactive cases is less than 500 cases nationwide. A small number of claims have been asserted by railroad workers alleging exposure to asbestos products in railroad cars manufactured by The Pullman Company, one of our subsidiaries. The substantial majority of the remaining claims are related to alleged exposure to asbestos in our automotive products. Only a small percentage of the claimants allege that they were automobile mechanics and a significant number appear to involve workers in other industries or otherwise do not include sufficient information to determine whether there is any basis for a claim against us. We believe, based on scientific and other evidence, it is unlikely that mechanics were exposed to asbestos by our former products and that, in any event, they would not be at increased risk of asbestos-related disease based on their work with these products. Further, many of these cases involve numerous defendants, with the number in some cases exceeding 100 defendants from a variety of industries. Additionally, the plaintiffs either do not specify any, or specify the jurisdictional minimum, dollar amount for damages. As major asbestos manufacturers and/or users continue to go out of business or file for bankruptcy, we may experience an increased number of these claims. We vigorously defend ourselves against these claims as part of our ordinary course of business. In future periods, we could be subject to cash costs or charges to earnings if any of these matters are resolved unfavorably to us. To date, with respect to claims that have proceeded sufficiently through the judicial process, we have regularly achieved favorable resolutions. Accordingly, we presently believe that these asbestos-related claims will not have a material adverse impact on our future consolidated financial position, results of operations or liquidity.

Warranty Matters

We provide warranties on some of our products. The warranty terms vary but range from one year up to limited lifetime warranties on some of our premium aftermarket products. Provisions for estimated expenses related to product warranty are made at the time products are sold or when specific warranty issues are identified on OE products. These estimates are established using historical information about the nature, frequency, and average cost of warranty claims. We actively study trends of our warranty claims and take action to improve product quality and minimize warranty claims. We believe that the warranty reserve is appropriate; however, actual claims incurred could differ from the original estimates, requiring adjustments to the reserve. The reserve is included in both current and long-term liabilities on the balance sheet.

Below is a table that shows the activity in the warranty accrual accounts:

	Three Months Ended March 31,
	2014			2013
	(Millions)
Beginning Balance January 1,	$	24		$	23
Accruals related to product warranties	5			2
Reductions for payments made	(5		)	(4		)
Ending Balance March 31,	$	24		$	21

Tenneco 401(K) Retirement Savings Plan

Effective January 1, 2012, the Tenneco Employee Stock Ownership Plan for Hourly Employees and the Tenneco Employee Stock Ownership Plan for Salaried Employees were merged into one plan called the Tenneco 401(k) Retirement Savings Plan (the “Retirement Savings Plan”). Under the plan, subject to limitations in the Internal Revenue Code, participants may elect to defer up to 75 percent of their salary through contributions to the plan, which are invested in selected mutual funds or used to buy our common stock. We match in cash 100 percent on the first three percent and 50 percent on the next two percent of employee contributions. In connection with freezing the defined benefit pension plans for nearly all U.S. based salaried and non-union hourly employees effective December 31, 2006, and the related replacement of those defined benefit plans with defined contribution plans, we are making additional contributions to the Employee Stock Ownership Plans. We recorded expense for these contributions of approximately $7 million and $6 million for the three month periods ended March 31, 2014 and 2013, respectively. Matching contributions vest immediately. Defined benefit replacement contributions fully vest on the employee’s third anniversary of employment.

ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

48

For information regarding our exposure to interest rate risk and foreign currency exchange rate risk, see the caption entitled “Derivative Financial Instruments” in “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which is incorporated herein by reference.

ITEM 4.CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

An evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the quarter covered by this report. Based on their evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are effective to ensure that information required to be disclosed by our Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and such information is accumulated and communicated to management as appropriate to allow timely decisions regarding required disclosures.

Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting during the quarter ended March 31, 2014, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

49

PART II

ITEM 1A.RISK FACTORS

We are exposed to certain risks and uncertainties that could have a material adverse impact on our business, financial condition and operating results. Except for the addition of the following risk factor, there have been no other material changes in the Company's risk factors from those previously disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2013.

We are subject to an investigation by antitrust regulators and developments in these investigations and related matters could have a material adverse effect on our consolidated financial position, results of operations or liquidity.

We are subject to a variety of laws and regulations that govern our business both in the United States and internationally, including antitrust laws. Violations of antitrust laws can result in significant penalties being imposed by antitrust authorities. Costs, charges and liabilities arising out of or related to these investigations and related claims can also be significant.

Antitrust authorities are investigating possible violations of antitrust laws by multiple automotive parts suppliers, including Tenneco. At this point, we cannot estimate the ultimate impact on our company from investigations into our antitrust compliance and related matters but, in light of the uncertainties and many variables involved in such investigations and potential related claims, we cannot assure you that the outcome of these and other investigations and related claims will not be material to Tenneco's consolidated financial position, results of operations or liquidity.

ITEM 2.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

(a) None.

(b) Not applicable.

(c) Purchase of equity securities by the issuer and affiliated purchasers. The following table provides information relating to our purchase of shares of our common stock in the first quarter of 2014. These purchases include shares withheld upon vesting of restricted stock for minimum tax withholding obligations. We intend to continue to satisfy statutory minimum tax withholding obligations in connection with the vesting of outstanding restricted stock through the withholding of shares.

In addition, in January 2014, our Board of Directors approved a share repurchase program, authorizing our company to repurchase up to 400,000 shares of the Company's outstanding common stock over a 12 month period. Our share repurchase program is intended to offset dilution from shares of restricted stock and stock options issued in 2014 to employees. We did not purchase any shares through this program in the three month period ended March 31, 2014.

Period	Total Number of Shares Purchased	Average Price Paid		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares That May Yet be Purchased Under These Plans or Programs
January 2014	48,244	$	56.83	—	400,000
February 2014	1,601	$	55.94	—	400,000
March 2014	99	$	60.55	—	400,000
Total	49,944	$	56.81	—	400,000

50

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, Tenneco Inc. has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

TENNECO INC.
By:	/S/    KENNETH R. TRAMMELL
	Kenneth R. Trammell
	Executive Vice President and Chief Financial Officer

Dated: May 6, 2014

51

INDEX TO EXHIBITS

TO

QUARTERLY REPORT ON FORM 10-Q

FOR QUARTER ENDED MARCH 31, 2014

Exhibit Number		Description
10.1	—	Tenneco Inc. Executive Bonus Plan (incorporated herein by reference to Exhibit 99.1of the registrant's Current Report on Form 8-K dated January 15, 2014, File No. 1-12387).
10.2	—	Form of Long-Term Performance Unit Award Agreement under the Tenneco Inc. 2006 Long-Term Incentive Plan (grants after January 14, 2014) (incorporated herein by reference to Exhibit 99.2 of the registrant's Current Report on Form 8-K dated January 15, 2014, File No. 1-12387).
10.3	—	Amendment No. 4 to Third Amended and Restated Receivables Purchase Agreement, dated as of March 21, 2014 (incorporated herein by reference to Exhibit 10.1 of the registrant's Current Report on Form 8-K dated March 31, 2014, File No. 1-12387).
10.4	—	Amendment No. 5 to SLOT Receivables Purchase Agreement, dated March 21, 2014 (incorporated herein by reference to Exhibit 10.2 of the registrant's Current Report on Form 8-K dated March 21, 2014, File No. 1-12387).
*12	—	Computation of Ratio of Earnings to Fixed Charges.
*15.1	—	Letter of PricewaterhouseCoopers LLP regarding interim financial information.
*31.1	—	Certification of Gregg M. Sherrill under Section 302 of the Sarbanes-Oxley Act of 2002.
*31.2	—	Certification of Kenneth R. Trammell under Section 302 of the Sarbanes-Oxley Act of 2002.
*32.1	—	Certification of Gregg M. Sherrill and Kenneth R. Trammell under Section 906 of the Sarbanes-Oxley Act of 2002.
*101.INS	—	XBRL Instance Document.
*101.SCH	—	XBRL Taxonomy Extension Schema Document.
*101.CAL	—	XBRL Taxonomy Extension Calculation Linkbase Document.
*101.DEF	—	XBRL Taxonomy Extension Definition Linkbase Document.
*101.LAB	—	XBRL Taxonomy Extension Label Linkbase Document.
*101.PRE	—	XBRL Taxonomy Extension Presentation Linkbase Document.

* Filed herewith.

52

EX-12

EXHIBIT 12

TENNECO INC. AND CONSOLIDATED SUBSIDIARIES

COMBINED WITH 50% OR LESS OWNED UNCONSOLIDATED SUBSIDIARIES

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

(UNAUDITED)

	Three Months Ended March 31,
	2014		2013
	(Millions)
Net income attributable to Tenneco Inc.	$	46	$	54
Add:
Interest expense	19		20
Portion of rental representative of the interest factor	5		5
Income tax expense	40		12
Noncontrolling interests	8		7
Amortization of interest capitalized	1		1
Undistributed (earnings) losses of affiliated companies in which less
than a 50% voting interest is owned
Earnings as defined	$	119	$	99
Interest expense	19		20
Interest capitalized	1		1
Portion of rentals representative of the interest factor	5		5
Fixed charges as defined	$	25	$	26
Ratio of earnings to fixed charges	4.76		3.81

EX-15.1

EXHIBIT 15.1

May 6, 2014

Securities and Exchange Commission

100 F Street, N.E.

Washington, DC 20549

Commissioners:

We are aware that our report dated May 6, 2014 on our review of interim financial information of Tenneco, Inc. for the three month periods ended March 31, 2014 and 2013 and included in the Company's quarterly report on Form 10-Q for the quarter ended March 31, 2014 is incorporated by reference in its Registration Statements on Form S-8 (Nos. 333-17485, 333-41535, 333-33934, 333-101973, 333-113705, 333-142475, 333-159358 and 333-192928).

Very truly yours,

/s/PricewaterhouseCoopers LLP

Milwaukee, WI

EX-31.1

EXHIBIT 31.1

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT

I, Gregg M. Sherrill, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Tenneco Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of the registrant’s internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/	GREGG M. SHERRILL
	Gregg M. Sherrill
	Chairman and Chief Executive Officer

Dated: May 6, 2014

EX-31.2

EXHIBIT 31.2

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT

I, Kenneth R. Trammell, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Tenneco Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of the registrant’s internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/	KENNETH R. TRAMMELL
	Kenneth R. Trammell
	Executive Vice President and Chief Financial Officer

Dated: May 6, 2014

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the accompanying Quarterly Report on Form 10-Q of Tenneco Inc. (the “Company”) for the period ended March 31, 2014, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), and pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, Gregg M. Sherrill, as Chief Executive Officer of the Company, and Kenneth R. Trammell, as Chief Financial Officer of the Company, hereby certify that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/	GREGG M. SHERRILL
	Gregg M. Sherrill
	Chief Executive Officer
/s/	KENNETH R. TRAMMELL
	Kenneth R. Trammell
	Chief Financial Officer

Dated: May 6, 2014

This certification shall not be deemed “filed” by the Company for purposes of Section 18 of the Securities Exchange Act of 1934. In addition, this certification shall not be deemed to be incorporated by reference into any filing under the Securities Exchange Act of 1933 or the Securities Exchange Act of 1934.

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Income Taxes - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended				12 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2014 Federal [Member]	Mar. 31, 2014 Europe [Member]	Dec. 31, 2013 Europe [Member]
Income Tax [Line Items]
Income tax expense (benefit)	$ 40	$ 12
Net tax benefits related to US taxable income	13
Expenses				2	60
Federal net operating loss			$ 5

XML

Segment Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Segment Reporting [Line Items]
Revenues from external customers	$ 2,094	$ 1,903
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	113	93
Total assets	4,179	3,878	3,830
Reclass and Elims
Segment Reporting [Line Items]
Revenues from external customers	0	0
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	0	0
Total assets	34	23
North America [Member]
Segment Reporting [Line Items]
Total assets		645
Europe South America And India [Member]
Segment Reporting [Line Items]
Revenues from external customers		252
Total assets		557
Asia Pacific
Segment Reporting [Line Items]
Revenues from external customers		48
Total assets		207
Other Countries [Member]
Segment Reporting [Line Items]
Revenues from external customers		0
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests		(21)
Clean Air Division [Member] | North America [Member]
Segment Reporting [Line Items]
Revenues from external customers	698	646
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	56	49
Total assets	1,197	1,144
Clean Air Division [Member] | Europe South America And India [Member]
Segment Reporting [Line Items]
Revenues from external customers	506
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	9
Total assets	908	833
Clean Air Division [Member] | Europe [Member]
Segment Reporting [Line Items]
Revenues from external customers		467
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests		11
Clean Air Division [Member] | Asia Pacific
Segment Reporting [Line Items]
Revenues from external customers	240	183
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	20	15
Total assets	563	469
Ride Performance Division [Member] | North America [Member]
Segment Reporting [Line Items]
Revenues from external customers	335	307
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	30	25
Total assets	701
Ride Performance Division [Member] | Europe South America And India [Member]
Segment Reporting [Line Items]
Revenues from external customers	263
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	16
Total assets	557
Ride Performance Division [Member] | Europe [Member]
Segment Reporting [Line Items]
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests		10
Ride Performance Division [Member] | Asia Pacific
Segment Reporting [Line Items]
Revenues from external customers	52
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	7	4
Total assets	219
Intersegment Revenues [Member]
Segment Reporting [Line Items]
Revenues from external customers	0	0
Intersegment Revenues [Member] | Reclass and Elims
Segment Reporting [Line Items]
Revenues from external customers	(58)	(53)
Intersegment Revenues [Member] | Clean Air Division [Member] | North America [Member]
Segment Reporting [Line Items]
Revenues from external customers	7	1
Intersegment Revenues [Member] | Clean Air Division [Member] | Europe South America And India [Member]
Segment Reporting [Line Items]
Revenues from external customers	29	31
Intersegment Revenues [Member] | Clean Air Division [Member] | Asia Pacific
Segment Reporting [Line Items]
Revenues from external customers	0	0
Intersegment Revenues [Member] | Ride Performance Division [Member] | North America [Member]
Segment Reporting [Line Items]
Revenues from external customers	3	2
Intersegment Revenues [Member] | Ride Performance Division [Member] | Europe South America And India [Member]
Segment Reporting [Line Items]
Revenues from external customers	10	12
Intersegment Revenues [Member] | Ride Performance Division [Member] | Asia Pacific
Segment Reporting [Line Items]
Revenues from external customers	9	7
Other Segments [Member]
Segment Reporting [Line Items]
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	(25)
Total assets	0	0
Other Segments [Member] | Other Countries [Member]
Segment Reporting [Line Items]
Revenues from external customers	0
Other Segments [Member] | Intersegment Revenues [Member] | Asia Pacific
Segment Reporting [Line Items]
Revenues from external customers	0
Other Segments [Member] | Intersegment Revenues [Member] | Other Countries [Member]
Segment Reporting [Line Items]
Revenues from external customers		$ 0

XML

Assumptions Used for Calculating Fair Values of Stock Option Awards (Detail) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Stock Options Granted
Weighted average grant date fair value, per share	$ 26.46	$ 19.84
Weighted average assumptions used:
Expected volatility	52.80%	66.40%
Expected lives	5 years 0 months 0 days	4 years 10 months 24 days
Risk-free interest rates	1.70%	0.70%
Dividend yields	0.00%	0.00%

XML

Segment Information Segment Information Textuals (Details)	3 Months Ended
	Mar. 31, 2014 operating_segment product_segment geographic_segment
Segment Reporting [Abstract]
Number of reportable segments	3
Number of product segments	2
Number of operating segments	6

XML

Earnings Per Share - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Earnings Per Share [Abstract]
Anti-dilutive stock options	782	831,243

XML

Foreign Exchange Forward Contracts Fair Value on Gross Basis (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Derivatives, Fair Value [Line Items]
Fair Value of Derivative Instruments, Asset Derivatives	$ 1	$ 0
Fair Value of Derivative Instruments, Liability Derivatives	0	0
Fair Value of Derivative Instruments	$ 1	$ 0
Term Of Foreign Currency Forward Purchase And Sales Contacts (less than one year)	1 year

XML

Statement of Comprehensive Income (Loss) (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Net sales and operating revenues —
External	$ 2,094	$ 1,903
Affiliated companies	0	0
Net sales and operating revenues	2,094	1,903
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	1,754	1,604
Engineering, research, and development	42	35
Selling, general, and administrative	132	119
Depreciation and amortization of other intangibles	51	50
Costs and expenses	1,979	1,808
Other income (expense)
Loss on sale of receivables	(1)	(1)
Other income (loss)	(1)	(1)
Total other income (expense)	(2)	(2)
Earnings before interest expense, income taxes, and noncontrolling interests	113	93
Interest expense —
External (net of interest capitalized)	19	20
Affiliated companies (net of interest income)	0	0
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies	94	73
Income tax expense	40	12
Equity in net income (loss) from affiliated companies	0	0
Net income	54	61
Less: Net income attributable to noncontrolling interests	8	7
Net income attributable to Tenneco Inc.	46	54
Comprehensive income (loss) attributable to Tenneco Inc.	43	32
Guarantor Subsidiaries
Net sales and operating revenues —
External	920	852
Affiliated companies	103	79
Net sales and operating revenues	1,023	931
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	802	742
Engineering, research, and development	22	15
Selling, general, and administrative	51	53
Depreciation and amortization of other intangibles	21	19
Costs and expenses	896	829
Other income (expense)
Loss on sale of receivables	0	0
Other income (loss)	(2)	(1)
Total other income (expense)	(2)	(1)
Earnings before interest expense, income taxes, and noncontrolling interests	125	101
Interest expense —
External (net of interest capitalized)	0	0
Affiliated companies (net of interest income)	16	18
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies	109	83
Income tax expense	30	6
Equity in net income (loss) from affiliated companies	(15)	(5)
Net income	64	72
Less: Net income attributable to noncontrolling interests	0	0
Net income attributable to Tenneco Inc.	64	72
Comprehensive income (loss) attributable to Tenneco Inc.	65	67
Non-Guarantor Subsidiaries
Net sales and operating revenues —
External	1,174	1,051
Affiliated companies	148	150
Net sales and operating revenues	1,322	1,201
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	1,203	1,091
Engineering, research, and development	20	20
Selling, general, and administrative	79	64
Depreciation and amortization of other intangibles	30	31
Costs and expenses	1,332	1,206
Other income (expense)
Loss on sale of receivables	(1)	(1)
Other income (loss)	1	0
Total other income (expense)	0	(1)
Earnings before interest expense, income taxes, and noncontrolling interests	(10)	(6)
Interest expense —
External (net of interest capitalized)	0	1
Affiliated companies (net of interest income)	(16)	(19)
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies	6	12
Income tax expense	10	6
Equity in net income (loss) from affiliated companies	0	0
Net income	(4)	6
Less: Net income attributable to noncontrolling interests	8	7
Net income attributable to Tenneco Inc.	(12)	(1)
Comprehensive income (loss) attributable to Tenneco Inc.	(16)	(18)
Tenneco Inc
Net sales and operating revenues —
External	0	0
Affiliated companies	0
Net sales and operating revenues	0	0
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	0	0
Engineering, research, and development	0	0
Selling, general, and administrative	2	2
Depreciation and amortization of other intangibles	0	0
Costs and expenses	2	2
Other income (expense)
Loss on sale of receivables	0	0
Other income (loss)	0	0
Total other income (expense)	0	0
Earnings before interest expense, income taxes, and noncontrolling interests	(2)	(2)
Interest expense —
External (net of interest capitalized)	19	19
Affiliated companies (net of interest income)	0	1
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies	(21)	(22)
Income tax expense		0
Equity in net income (loss) from affiliated companies	67	76
Net income	46	54
Less: Net income attributable to noncontrolling interests	0	0
Net income attributable to Tenneco Inc.	46	54
Comprehensive income (loss) attributable to Tenneco Inc.	46	54
Reclass & Elims
Net sales and operating revenues —
External	0	0
Affiliated companies	(251)	(229)
Net sales and operating revenues	(251)	(229)
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	(251)	(229)
Engineering, research, and development	0	0
Selling, general, and administrative	0	0
Depreciation and amortization of other intangibles	0	0
Costs and expenses	(251)	(229)
Other income (expense)
Loss on sale of receivables	0	0
Other income (loss)	0	0
Total other income (expense)	0	0
Earnings before interest expense, income taxes, and noncontrolling interests	0	0
Interest expense —
External (net of interest capitalized)	0	0
Affiliated companies (net of interest income)	0	0
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies	0	0
Income tax expense		0
Equity in net income (loss) from affiliated companies	(52)	(71)
Net income	(52)	(71)
Less: Net income attributable to noncontrolling interests	0	0
Net income attributable to Tenneco Inc.	(52)	(71)
Comprehensive income (loss) attributable to Tenneco Inc.	$ (52)	$ (71)

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Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2014

Earnings Per Share [Abstract]

Summary of Earnings Per Share of Common Stock

Earnings per share of common stock outstanding were computed as follows:

	Three Months Ended March 31, 2014		Three Months Ended March 31, 2013
	(Millions Except Share and Per Share Amounts)
Basic earnings per share —
Net income attributable to Tenneco Inc.	$	46	$	54
Weighted Average shares of common stock outstanding	60,549,778		60,288,997
Earnings per share of common stock	$	0.76	$	0.90
Diluted earnings per share —
Net income attributable to Tenneco Inc.	$	46	$	54
Weighted Average shares of common stock outstanding	60,549,778		60,288,997
Effect of dilutive securities:
Restricted stock	160,341		138,594
Stock options	793,183		1,054,244
Weighted Average shares of common stock outstanding including dilutive securities	61,503,302		61,481,835
Earnings per share of common stock	$	0.75	$	0.88

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Nonvested Restricted Shares (Detail) (Restricted Stock [Member], USD $)	3 Months Ended
	Mar. 31, 2013	Dec. 31, 2013
Restricted Stock [Member]
Nonvested Restricted Shares
Nonvested, Beginning Balance		368,268
Granted	131,561
Vested	(186,112)
Nonvested, Ending Balance	313,717	368,268
Weighted Avg. Grant Date Fair Value
Nonvested, Beginning Balance		$ 34.90
Granted	$ 54.90
Vested	$ 36.57
Nonvested, Ending Balance	$ 42.30	$ 34.90
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period	0
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value	$ 0.00

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Roll Forward of Restructuring Reserve (Detail) (Severance [Member], USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014
Severance [Member]
Restructuring Reserve [Roll Forward]
Restructuring Reserve	$ 44
Expenses	9
Cash Payments	(5)
Restructuring Reserve	$ 48

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Long-Term Debt and Financing Arrangements - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 22, 2012
Long Term Debt And Other Financing Arrangement [Line Items]
Maximum percentage of stock of certain first-tier foreign subsidiaries pledged to secure senior credit facility	66.00%
Interest coverage ratio (minimum) effective from March 31, 2014 through March 22, 2017	2.75
Leverage Ratio Required (Maximum) for future quarters	3.50
Tranche Term Facility [Member]
Long Term Debt And Other Financing Arrangement [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 225	$ 250
Line of Credit Facility, Maturity Date	Mar. 22, 2017
Tranche Term Facility [Member] | June 30, 2014 through March 31, 2015 [Member]
Long Term Debt And Other Financing Arrangement [Line Items]
Repayment of term loan	6.3
Tranche Term Facility [Member] | June 30, 2015 through March 31, 2016 [Member]
Long Term Debt And Other Financing Arrangement [Line Items]
Repayment of term loan	9.4
Tranche Term Facility [Member] | June 30, 2016 through December 31, 2016 [Member]
Long Term Debt And Other Financing Arrangement [Line Items]
Repayment of term loan	12.5
Tranche Term Facility [Member] | Due on March 22, 2017 [Member]
Long Term Debt And Other Financing Arrangement [Line Items]
Repayment of term loan	125.0
Revolving Credit Facility (Member)
Long Term Debt And Other Financing Arrangement [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	850
Line of Credit Facility, Maturity Date	Mar. 22, 2017
Unused Borrowing Capacity	562
Outstanding borrowings in senior secured credit facility	251
Letter of Credit (Member)
Long Term Debt And Other Financing Arrangement [Line Items]
Line of credit facility letters of credit outstanding	37
7 3/4 percent senior notes due August 15, 2018 [Member]
Long Term Debt And Other Financing Arrangement [Line Items]
Senior notes rate	7.75%
Unsecured debt	225
6 7/8 percent senior notes due Dec 15, 2020 [Member]
Long Term Debt And Other Financing Arrangement [Line Items]
Senior notes rate	6.875%
Unsecured debt	500
Other Debt [Member]
Long Term Debt And Other Financing Arrangement [Line Items]
Unsecured debt	$ 114

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Pension Plans, Postretirement and Other Employee Benefits - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014
United States Pension Plans of US Entity, Defined Benefit [Member]
Pension Plans, Postretirement and Other Employee Benefits [Line Items]
Employer contributions	$ 7
Foreign Pension Plans, Defined Benefit [Member]
Pension Plans, Postretirement and Other Employee Benefits [Line Items]
Employer contributions	4
Pension Plans, Defined Benefit [Member]
Pension Plans, Postretirement and Other Employee Benefits [Line Items]
Employer estimated contributions	36
United States Postretirement Benefit Plans of US Entity, Defined Benefit [Member]
Pension Plans, Postretirement and Other Employee Benefits [Line Items]
Employer contributions	2
Employer estimated contributions	$ 6

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Common Stock - Additional Information (Detail) (USD $) In Millions, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2012
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share-based Compensation, Effect on Earnings Per Share, Basic	$ 0.04	$ 0.04
Share-based compensation, effect on earnings per share, diluted			$ 0.04
Share based compensation	$ 5	$ 5
Weighted average grant-date fair value of options granted	$ 26.46	$ 19.84
Total fair value of shares vested	6	5	6
Stock Option [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Unrecognized compensation costs	9
Unrecognized compensation costs, weighted average period	1 year 7 months 6 days
Cash received from stock option exercises	1	2
Restricted Stock, Restricted Stock Units, Long Term Performance Units, SARs [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Unrecognized compensation costs	26
Unrecognized compensation costs, weighted average period	2 years 1 month 6 days
Share based compensation	8	5
Restricted Stock [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Unrecognized compensation costs	10
Unrecognized compensation costs, weighted average period	2 years 2 months 12 days
Total fair value of restricted shares vested	7	5
Selling, General and Administrative Expenses [Member] | Stock Option [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Compensation expense related to nonqualified stock options	2	2
UNITED STATES | Stock Option [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Cash received from stock option exercises		$ 12

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Financial Instruments

3 Months Ended

Mar. 31, 2014

Fair Value Disclosures [Abstract]

Financial Instruments

Financial Instruments

The carrying and estimated fair values of our financial instruments by class at March 31, 2014 and December 31, 2013 were as follows:

	March 31, 2014				December 31, 2013
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(Millions)
Long-term debt (including current maturities)	$	1,211	$	1,275	$	1,021	$	1,089
Instruments with off-balance sheet risk:
Foreign exchange forward contracts:
Asset derivative contracts	1		1		—		—

Asset and Liability Instruments — The fair value of cash and cash equivalents, short and long-term receivables, accounts payable, and short-term debt was considered to be the same as or was not determined to be materially different from the carrying amount.

Long-term Debt — The fair value of our public fixed rate senior notes is based on quoted market prices (level 1). The fair value of our private borrowings under our senior credit facility and other long-term debt instruments is based on the market value of debt with similar maturities, interest rates and risk characteristics (level 2). The fair value of our level 1 debt, as classified in the fair value hierarchy, was $789 million and $790 million at March 31, 2014 and December 31, 2013, respectively. We have classified $477 million and $287 million as level 2 in the fair value hierarchy at March 31, 2014 and December 31, 2013, respectively, since we utilize valuation inputs that are observable both directly and indirectly. We classified the remaining $9 million and $10 million, consisting of foreign subsidiary debt, as level 3 in the fair value hierarchy at March 31, 2014 and December 31, 2013, respectively.

Foreign Exchange Forward Contracts — We use derivative financial instruments, principally foreign currency forward purchase and sales contracts with terms of less than one year, to hedge our exposure to changes in foreign currency exchange rates. Our primary exposure to changes in foreign currency rates results from intercompany loans made between affiliates to minimize the need for borrowings from third parties. Additionally, we enter into foreign currency forward purchase and sale contracts to mitigate our exposure to changes in exchange rates on certain intercompany and third-party trade receivables and payables. We manage counter-party credit risk by entering into derivative financial instruments with major financial institutions that can be expected to fully perform under the terms of such agreements. We do not enter into derivative financial instruments for speculative purposes. The fair value of our foreign currency forward contracts is based on an internally developed model which incorporates observable inputs including quoted spot rates, forward exchange rates and discounted future expected cash flows utilizing market interest rates with similar quality and maturity characteristics. We record the change in fair value of these foreign exchange forward contracts as part of currency gains (losses) within cost of sales in the condensed consolidated statements of income. The fair value of foreign exchange forward contracts are recorded in prepayments and other current assets or other current liabilities in the condensed consolidated balance sheet. The fair value of our foreign exchange forward contracts, presented on a gross basis at March 31, 2014 and December 31, 2013, respectively, was as follows:

Fair Value of Derivative Instruments

March 31, 2014

December 31, 2013

Asset Derivatives

Liability Derivatives

Total

Asset Derivatives

Liability Derivatives

Total

(Millions)

Foreign exchange forward contracts

$1

$—

$1

$

—

$—

$—

The fair value of our recurring financial assets at March 31, 2014 and December 31, 2013, respectively, are as follows:

	March 31, 2014				December 31, 2013
	Level 1	Level 2		Level 3	Level 1	Level 2		Level 3
	(Millions)
Financial Assets:
Foreign exchange forward contracts	n/a	$	1	n/a	n/a	$	—	n/a

The fair value hierarchy definition prioritizes the inputs used in measuring fair value into the following levels:

Level 1	—	Quoted prices in active markets for identical assets or liabilities.
Level 2	—	Inputs, other than quoted prices in active markets, that are observable either directly or indirectly.
Level 3	—	Unobservable inputs based on our own assumptions.

The following table summarizes by major currency the notional amounts for foreign currency forward purchase and sale contracts as of March 31, 2014 (all of which mature in 2014):

		Notional Amount in Foreign Currency
		(Millions)
Australian dollars	—Purchase	2
British pounds	—Purchase	31
	—Sell	(5	)
Canadian dollars	—Purchase	12
	—Sell	(2	)
European euro	—Purchase	8
	—Sell	(15	)
South African rand	—Purchase	222
Japanese yen	—Purchase	196
	—Sell	(461	)
Polish zloty	—Purchase	21
U.S. dollars	—Purchase	16
	—Sell	(84	)

Guarantees —We have from time to time issued guarantees for the performance of obligations by some of our subsidiaries, and some of our subsidiaries have guaranteed our debt. All of our existing and future material domestic wholly-owned subsidiaries fully and unconditionally guarantee our senior credit facility and our senior notes on a joint and several basis. The arrangement for the senior credit facility is also secured by first-priority liens on substantially all our domestic assets and pledges of up to 66 percent of the stock of certain first-tier foreign subsidiaries. No assets or capital stock of our direct or indirect subsidiaries secure our senior notes. For additional information, refer to Note 13 of our condensed consolidated financial statements, where we present the Supplemental Guarantor Condensed Consolidating Financial Statements.

We have two performance guarantee agreements in the U.K. between Tenneco Management Europe Limited (“TMEL”) and the two Walker Group Retirement Plans, the Walker Group Employee Benefit Plan and the Walker Group Executive Retirement Benefit Plan (the “Walker Plans”), whereby TMEL will guarantee the payment of all current and future pension contributions in event of a payment default by the sponsoring or participating employers of the Walker Plans. As a result of our decision to enter into these performance guarantee agreements, the levy due to the U.K. Pension Protection Fund was reduced. The Walker Plans are comprised of employees from Tenneco Walker (U.K.) Limited and our Futaba-Tenneco U.K. joint venture. Employer contributions are funded by both Tenneco Walker (U.K.) Limited, as the sponsoring employer and Futaba-Tenneco U.K., as a participating employer. The performance guarantee agreements are expected to remain in effect until all pension obligations for the Walker Plans’ sponsoring and participating employers have been satisfied. The maximum amount payable for these pension performance guarantees is approximately $32 million as of March 31, 2014 which is determined by taking 105 percent of the liability of the Walker Plans calculated under section 179 of the U.K. Pension Act of 2004 offset by plan assets. We did not record an additional liability for this performance guarantee since Tenneco Walker (U.K.) Limited, as the sponsoring employer of the Walker Plans, already recognizes 100 percent of the pension obligation calculated based on U.S. GAAP, for all of the Walker Plans’ participating employers on its balance sheet, which was $9 million and $10 million at March 31, 2014 and December 31, 2013, respectively. At March 31, 2014, all pension contributions under the Walker Plans were current for all of the Walker Plans’ sponsoring and participating employers.

In June 2011, we entered into an indemnity agreement between TMEL and Futaba Industrial Co. Ltd. which requires Futaba to indemnify TMEL for any cost, loss or liability which TMEL may incur under the performance guarantee agreements relating to the Futaba-Tenneco U.K. joint venture. The maximum amount reimbursable by Futaba to TMEL under this indemnity agreement is equal to the amount incurred by TMEL under the performance guarantee agreements multiplied by Futaba’s shareholder ownership percentage of the Futaba-Tenneco U.K. joint venture. At March 31, 2014, the maximum amount reimbursable by Futaba to TMEL is approximately $6 million.

We have issued guarantees through letters of credit in connection with some obligations of our affiliates. As of March 31, 2014, we have guaranteed $38 million in letters of credit to support some of our subsidiaries’ insurance arrangements, foreign employee benefit programs, environmental remediation activities and cash management and capital requirements.

Negotiable Financial Instruments — One of our European subsidiaries receives payment from one of its customers whereby the accounts receivable are satisfied through the delivery of negotiable financial instruments. We may collect these financial instruments before their maturity date by either selling them at a discount or using them to satisfy accounts receivable that have previously been sold to a European bank. Any of these financial instruments which are not sold are classified as other current assets. The amount of these financial instruments that was collected before their maturity date and sold at a discount totaled $6 million and $5 million at March 31, 2014 and December 31, 2013, respectively. No negotiable financial instruments were held by our European subsidiary as of March 31, 2014 or December 31, 2013.

In certain instances, several of our Chinese subsidiaries receive payments from customers and satisfy vendor payments through the receipt and delivery of negotiable financial instruments. Financial instruments issued to satisfy vendor payables and not redeemed totaled $21 million and $13 million at March 31, 2014 and December 31, 2013, respectively, and were classified as notes payable. Financial instruments received from customers and not redeemed totaled $20 million and $12 million at March 31, 2014 and December 31, 2013, respectively. We classify financial instruments received from our customers as other current assets if issued by a financial institution of our customers or as customer notes and accounts, net if issued by our customer. We classified $20 million and $12 million in other current assets at March 31, 2014 and December 31, 2013, respectively. Some of our Chinese subsidiaries that issue their own negotiable financial instruments to pay vendors are required to maintain a cash balance if they exceed certain credit limits with the financial institution that guarantees those financial instruments. A restricted cash balance was required at those Chinese subsidiaries at March 31, 2014 for less than $1 million and was not required at December 31, 2013.

The negotiable financial instruments received by one of our European subsidiaries and some of our Chinese subsidiaries are checks drawn by our customers and guaranteed by their banks that are payable at a future date. The use of these instruments for payment follows local commercial practice. Because negotiable financial instruments are financial obligations of our customers and are guaranteed by our customers’ banks, we believe they represent a lower financial risk than the outstanding accounts receivable that they satisfy which are not guaranteed by a bank.

Supply Chain Financing — Near the end of the second quarter of 2013 certain of our suppliers in the U.S. extended their payment terms to Tenneco. The liquidity benefit to Tenneco from the extended payment terms totaled $11 million at March 31, 2014. These suppliers also began participating in a supply chain financing program under which they securitize their accounts receivables from Tenneco with two financial institutions. The financial institutions participate in the supply chain financing program on an uncommitted basis and can cease purchasing receivables from Tenneco's suppliers at any time. If the financial institutions did not continue to purchase receivables from Tenneco's suppliers under this program, the participating vendors could reduce their payment terms to Tenneco which in turn would cause our borrowings under our revolving credit facility to increase.

Restricted Cash - Two of our Australian subsidiaries arranged for $5 million in guarantees to be issued by a financial institution to support some of our subsidiaries' property lease arrangements and workers compensation programs. These guarantees were supported by a cash deposit with the financial institution which has been classified as restricted cash on the Tenneco Inc. consolidated balance sheet at March 31, 2014.

Some of our Chinese subsidiaries are required to maintain a cash balance if they exceed certain credit limits with the financial institution that guarantees the negotiable financial instruments issued by Tenneco to pay vendors. At the end of the first quarter of 2014, one of our Chinese subsidiaries exceeded their credit limits and was required to maintain a cash balance. The cash balance required was less than $1 million which has been classified as restricted cash on the Tenneco Inc. consolidated balance sheet at March 31, 2014.

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Environmental Matters, Litigation and Product Warranties - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014 LegalMatter defendent State federal_superfund_site
Environmental Matters, Litigation and Product Warranties [Line Items]
Number of Federal Super Fund sites	1
Environmental remediation accrual, discounted basis	$ 15
Portion of environmental remediation costs recorded in other current liabilities	3
Portion of environmental remediation costs recorded in deferred credits and other liabilities	12
Weighted average discount rate	2.50%
Environmental remediation accrual, undiscounted basis	19
Cost of services, environmental remediation, next twelve months	3
Cost of services, environmental remediation, year two	1
Cost of services, environmental remediation, year three	1
Cost of services, environmental remediation, year four	1
Cost of services, environmental remediation, year five	1
Cost of services, environmental remediation, thereafter	$ 12
Number of states for which we are subject to an audit with respect to payment of unclaimed property	11
Number of years subject to audit with respect to payment of unclaimed property	30 years
Number of complaints filed alleging exposure to asbestos from our product categories	20,000
Current docket of active and inactive cases nationwide relating to alleged exposure to asbestos from our product categories (less than 500 cases)	500
Number of defendants in many asbestos related cases	100

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Supplemental Guarantor Condensed Consolidating Financial Statements (Tables)

3 Months Ended

Mar. 31, 2014

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Statement of Comprehensive Income (Loss)

STATEMENT OF COMPREHENSIVE INCOME (LOSS)

	For the Three Months Ended March 31, 2014
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims			Consolidated
	(Millions)
Revenues
Net sales and operating revenues —
External	$	920		$	1,174		$	—		$	—		$	2,094
Affiliated companies	103			148			—			(251		)	—
	1,023			1,322			—			(251		)	2,094
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	802			1,203			—			(251		)	1,754
Engineering, research, and development	22			20			—			—			42
Selling, general, and administrative	51			79			2			—			132
Depreciation and amortization of other intangibles	21			30			—			—			51
	896			1,332			2			(251		)	1,979
Other income (expense)
Loss on sale of receivables	—			(1		)	—			—			(1		)
Other income (loss)	(2		)	1			—			—			(1		)
	(2		)	—			—			—			(2		)
Earnings (loss) before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies	125			(10		)	(2		)	—			113
Interest expense —
External (net of interest capitalized)	—			—			19			—			19
Affiliated companies (net of interest income)	16			(16		)	—			—			—
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies	109			6			(21		)	—			94
Income tax expense	30			10									40
Equity in net income (loss) from affiliated companies	(15		)	—			67			(52		)	—
Net Income (loss)	64			(4		)	46			(52		)	54
Less: Net income attributable to noncontrolling interests	—			8			—			—			8
Net income (loss) attributable to Tenneco Inc.	$	64		$	(12	)	$	46		$	(52	)	$	46
Comprehensive income (loss) attributable to Tenneco Inc.	$	65		$	(16	)	$	46		$	(52	)	$	43

STATEMENT OF COMPREHENSIVE INCOME (LOSS)

	For the Three Months Ended March 31, 2013
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims			Consolidated
	(Millions)
Revenues
Net sales and operating revenues —
External	$	852		$	1,051		$	—		$	—		$	1,903
Affiliated companies	79			150			—			(229		)	—
	931			1,201			—			(229		)	1,903
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	742			1,091			—			(229		)	1,604
Engineering, research, and development	15			20			—			—			35
Selling, general, and administrative	53			64			2			—			119
Depreciation and amortization of other intangibles	19			31			—			—			50
	829			1,206			2			(229		)	1,808
Other income (expense)
Loss on sale of receivables	—			(1		)	—			—			(1		)
Other income (expense)	(1		)	—			—			—			(1		)
	(1		)	(1		)	—			—			(2		)
Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies	101			(6		)	(2		)	—			93
Interest expense —
External (net of interest capitalized)	—			1			19			—			20
Affiliated companies (net of interest income)	18			(19		)	1			—			—
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies	83			12			(22		)	—			73
Income tax expense	6			6			—			—			12
Equity in net income (loss) from affiliated companies	(5		)	—			76			(71		)	—
Net income (loss)	72			6			54			(71		)	61
Less: Net income attributable to noncontrolling interests	—			7			—			—			7
Net income (loss) attributable to Tenneco Inc.	$	72		$	(1	)	$	54		$	(71	)	$	54
Comprehensive income (loss) attributable to Tenneco Inc.	$	67		$	(18	)	$	54		$	(71	)	$	32

Balance Sheet

BALANCE SHEET

	March 31, 2014
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims			Consolidated
	(Millions)
ASSETS
Current assets:
Cash and cash equivalents	$	2		$	265		$	—		$	—		$	267
Restricted cash	—			6			—			—			6
Receivables, net	593			1,464			16			(785		)	1,288
Inventories	314			423			—			—			737
Deferred income taxes	88			—			7			(24		)	71
Prepayments and other	41			217			1			—			259
Total current assets	1,038			2,375			24			(809		)	2,628
Other assets:
Investment in affiliated companies	926			—			768			(1,694		)	—
Notes and advances receivable from affiliates	1,030			8,124			5,004			(14,158		)	—
Long-term receivables, net	12			2			—			—			14
Goodwill	22			47			—			—			69
Intangibles, net	12			17			—			—			29
Deferred income taxes	61			9			47			—			117
Other	45			61			22			—			128
	2,108			8,260			5,841			(15,852		)	357
Plant, property, and equipment, at cost	1,187			2,358			—			—			3,545
Less — Accumulated depreciation and amortization	(817		)	(1,534		)	—			—			(2,351		)
	370			824			—			—			1,194
Total assets	$	3,516		$	11,459		$	5,865		$	(16,661	)	$	4,179
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	$	—		$	91		$	15		$	—		$	106
Short-term debt — affiliated	217			336			10			(563		)	—
Trade payables	539			1,066			—			(175		)	1,430
Accrued taxes	9			35			—			—			44
Other	134			298			13			(71		)	374
Total current liabilities	899			1,826			38			(809		)	1,954
Long-term debt — non-affiliated	—			7			1,202			—			1,209
Long-term debt — affiliated	1,878			8,145			4,135			(14,158		)	—
Deferred income taxes	—			29			—			—			29
Postretirement benefits and other liabilities	339			86			(1		)	5			429
Commitments and contingencies
Total liabilities	3,116			10,093			5,374			(14,962		)	3,621
Redeemable noncontrolling interests	—			25			—			—			25
Tenneco Inc. shareholders’ equity	400			1,299			491			(1,699		)	491
Noncontrolling interests	—			42			—			—			42
Total equity	400			1,341			491			(1,699		)	533
Total liabilities, redeemable noncontrolling interests and equity	$	3,516		$	11,459		$	5,865		$	(16,661	)	$	4,179

BALANCE SHEET

	December 31, 2013
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)		Reclass & Elims			Consolidated
	(Millions)
ASSETS
Current assets:
Cash and cash equivalents	$	6		$	269		$	—	$	—		$	275
Restricted cash	—			5			—		—			5
Receivables, net	387			1,306			16		(649		)	1,060
Inventories	279			377			—		—			656
Deferred income taxes	87			—			7		(23		)	71
Prepayments and other	35			188			—		—			223
Total current assets	794			2,145			23		(672		)	2,290
Other assets:
Investment in affiliated companies	944			—			696		(1,640		)	—
Notes and advances receivable from affiliates	1,026			7,320			4,826		(13,172		)	—
Long-term receivables, net	12			2			—		—			14
Goodwill	22			47			—		—			69
Intangibles, net	13			17			—		—			30
Deferred income taxes	72			9			44		—			125
Other	44			60			23		—			127
	2,133			7,455			5,589		(14,812		)	365
Plant, property, and equipment, at cost	1,173			2,325			—		—			3,498
Less — Accumulated depreciation and amortization	(807		)	(1,516		)	—		—			(2,323		)
	366			809			—		—			1,175
Total assets	$	3,293		$	10,409		$	5,612	$	(15,484	)	$	3,830
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	$	—		$	68		$	15	$	—		$	83
Short-term debt — affiliated	247			176			10		(433		)	—
Trade payables	521			1,011			—		(173		)	1,359
Accrued taxes	9			31			—		—			40
Other	128			285			9		(66		)	356
Total current liabilities	905			1,571			34		(672		)	1,838
Long-term debt — non-affiliated	—			8			1,011		—			1,019
Long-term debt — affiliated	1,700			7,338			4,134		(13,172		)	—
Deferred income taxes	—			28			—		—			28
Postretirement benefits and other liabilities	357			92			—		4			453
Commitments and contingencies
Total liabilities	2,962			9,037			5,179		(13,840		)	3,338
Redeemable noncontrolling interests	—			20			—		—			20
Tenneco Inc. shareholders’ equity	331			1,313			433		(1,644		)	433
Noncontrolling interests	—			39			—		—			39
Total equity	331			1,352			433		(1,644		)	472
Total liabilities, redeemable noncontrolling interests and equity	$	3,293		$	10,409		$	5,612	$	(15,484	)	$	3,830

Statement of Cash Flows

STATEMENT OF CASH FLOWS

	Three Months Ended March 31, 2014
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims		Consolidated
	(Millions)
Operating Activities
Net cash provided (used) by operating activities	$	(208	)	$	90		$	(22	)	$	—	$	(140	)
Investing Activities
Cash payments for plant, property, and equipment	(25		)	(58		)	—			—		(83		)
Cash payments for software related intangible assets	(4		)	(3		)	—			—		(7		)
Changes in restricted cash	—			(1		)	—			—		(1		)
Net cash used by investing activities	(29		)	(62		)	—			—		(91		)
Financing Activities
Issuance (repurchase) of common shares	—			—			(2		)	—		(2		)
Tax benefit from stock-based compensation	—			—			12			—		12
Retirement of long-term debt	—			—			(3		)	—		(3		)
Increase (decrease) in bank overdrafts	—			4						—		4
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivables	—			24			173			—		197
Net increase (decrease) in short-term borrowings secured by accounts receivables	—			—			20			—		20
Intercompany dividends and net increase (decrease) in intercompany obligations	233			(55		)	(178		)	—		—
Capital contribution from noncontrolling interest partners	—			1			—			—		1
Net cash provided (used) by financing activities	233			(26		)	22			—		229
Effect of foreign exchange rate changes on cash and cash equivalents	—			(6		)	—			—		(6		)
Increase (decrease) in cash and cash equivalents	(4		)	(4		)	—			—		(8		)
Cash and cash equivalents, January 1	6			269			—			—		275
Cash and cash equivalents, March 31 (Note)	$	2		$	265		$	—		$	—	$	267

Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase.

STATEMENT OF CASH FLOWS

	Three Months Ended March 31, 2013
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims		Consolidated
	(Millions)
Operating Activities
Net cash provided (used) by operating activities	$	(102	)	$	15		$	(5	)	$	—	$	(92	)
Investing Activities
Proceeds from sale of assets	—			2			—			—		2
Cash payments for plant, property, and equipment	(32		)	(38		)	—			—		(70		)
Cash payments for software related intangible assets	(3		)	(3		)	—			—		(6		)
Changes in restricted cash	—			(9		)						(9		)
Net cash used by investing activities	(35		)	(48		)	—			—		(83		)
Financing Activities
Issuance of common shares	—			—			1			—		1
Retirement of long-term debt	—			—			(5		)	—		(5		)
Increase (decrease) in bank overdrafts	—			(9		)	—			—		(9		)
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt	—			3			188			—		191
Intercompany dividends and net increase (decrease) in intercompany obligations	137			42			(179		)	—		—
Net cash provided by financing activities	137			36			5			—		178
Effect of foreign exchange rate changes on cash and cash equivalents	—			7			—			—		7
Increase (decrease) in cash and cash equivalents	—			10			—			—		10
Cash and cash equivalents, January 1	4			219			—			—		223
Cash and cash equivalents, March 31 (Note)	$	4		$	229		$	—		$	—	$	233

Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase.

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Segment Information (Tables)

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Segment Information

The following table summarizes certain Tenneco Inc. segment information:

	Clean Air Division						Ride Performance Division
	North America		Europe, South America & India		Asia Pacific		North America		Europe, South America & India		Asia Pacific		Other			Reclass & Elims			Total
	(Millions)
At March 31, 2014 and for the Three Months Ended March 31, 2014
Revenues from external customers	$	698	$	506	$	240	$	335	$	263	$	52	$	—		$	—		$	2,094
Intersegment revenues	7		29		—		3		10		9		—			(58		)	—
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	56		9		20		30		16		7		(25		)	—			113
Total assets	1,197		908		563		701		557		219		—			34			4,179
At March 31, 2013 and for the Three Months Ended March 31, 2013
Revenues from external customers	646		467		183		307		252		48		—			—			1,903
Intersegment revenues	1		31		—		2		12		7		—			(53		)	—
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	49		11		15		25		10		4		(21		)	—			93
Total assets	1,144		833		469		645		557		207		—			23			3,878

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Supplemental Guarantor Condensed Consolidating Financial Statements - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2014
Condensed Financial Information of Parent Company Only Disclosure [Abstract]
Ownership percentage of existing and future material domestic owned subsidiaries	100.00%

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Warranty Accrual Rollforward (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2011
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward]
Beginning Balance January 1,	$ 24		$ 23
Accruals related to product warranties	5	2
Reductions for payments made	(5)	(4)
Ending Balance March 31,	$ 24	$ 21	$ 23

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Consolidation and Presentation - Additional Information (Detail)	Mar. 31, 2014
Minimum [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Range of percentages of investments, equity method investments	20.00%
Maximum [Member]
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Range of percentages of investments, equity method investments	50.00%

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Carrying and Estimated Fair Value (Detail) (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Instruments with off-balance sheet risk:
Asset derivative contracts	$ 1	$ 0
Reported Value Measurement [Member]
Carrying and estimated fair value
Long-term debt (including current maturities)	1,211	1,021
Instruments with off-balance sheet risk:
Asset derivative contracts	1	0
Estimate of Fair Value Measurement [Member]
Carrying and estimated fair value
Long-term debt (including current maturities)	1,275	1,089
Instruments with off-balance sheet risk:
Asset derivative contracts	$ 1	$ 0

XML

Consolidation and Presentation

3 Months Ended

Mar. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Consolidation and Presentation

Consolidation and Presentation

As you read the accompanying financial statements you should also read our Annual Report on Form 10-K for the year ended December 31, 2013.

In our opinion, the accompanying unaudited financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly Tenneco Inc.’s results of operations, comprehensive income, financial position, cash flows, and changes in shareholders’ equity for the periods indicated. We have prepared the unaudited condensed consolidated financial statements pursuant to the rules and regulations of the U.S. Securities and Exchange Commission for interim financial information. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (U.S. GAAP) for annual financial statements.

Our condensed consolidated financial statements include all majority-owned subsidiaries. We carry investments in 20 percent to 50 percent owned companies in which the Company does not have a controlling interest, as equity method investments, at cost plus equity in undistributed earnings since the date of acquisition and cumulative translation adjustments. We have eliminated all intercompany transactions. We have evaluated all significant subsequent events for any impact on these financial statements through the date they were issued.

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Fair Value of Long Term Debt - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Level 1 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of long term debt	$ 789	$ 790
Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of long term debt	477	287
Level 3 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Fair value of long term debt	$ 9	$ 10

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Accounts Receivables - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Transfers of Servicing of Financial Assets [Line Items]
Number of Commercial Banks with Accounts Receivable Securitization Programs	3
Term of Commitments	1 year
Term Of Commitments, Cancellation Period	90 days
Term Of Commitments, Financial Institution Cancellation Period	15 days
North America [Member]
Transfers of Servicing of Financial Assets [Line Items]
North American program maximum facility size	$ 110
Additional Financing from second priority facility	40
Outstanding third party investments in securitized accounts receivable bank program	30		10
Securitization Interest Expense	1	1
Europe [Member]
Transfers of Servicing of Financial Assets [Line Items]
Outstanding third party investments in securitized accounts receivable bank program	175		134
Loss on sale of trade accounts receivable	$ 1	$ 1
Financing Cost Related To Sale Of Securitized Receivables	3.00%	3.00%

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Amounts Recognized for Pension and Postretirement Benefits in Other Comprehensive Income (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Compensation and Retirement Disclosure [Abstract]
Amortization of prior service cost included in net periodic pension and postretirement cost, Before-tax amount	$ 0	$ (1)
Amortization of actuarial loss included in net periodic pension and postretirement cost, Before-tax amount	4	6
Other comprehensive income - pension benefits, Before-tax amount	4	5
Amortization of prior service cost included in net periodic pension and postretirement cost, Tax Benefit	0	0
Amortization of actuarial loss included in net periodic pension and postretirement cost, Tax Benefit	(1)	(1)
Other comprehensive - pension benefits, Tax Benefit	(1)	(1)
Amortization of prior service cost included in net periodic pension and postretirement cost, Net-of-tax Amount	0	(1)
Amortization of actuarial loss included in net periodic pension and postretirement cost, Net-of-tax Amount	3	5
Other comprehensive income - pension benefits, Net-of-tax Amount	$ 3	$ 4

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CONDENSED CONSOLIDATED STATEMENTS OF INCOME (USD $) In Millions, except Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Revenues
Net sales and operating revenues	$ 2,094	$ 1,903
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	1,754	1,604
Engineering, research, and development	42	35
Selling, general, and administrative	132	119
Depreciation and amortization of other intangibles	51	50
Costs and expenses	1,979	1,808
Other expense
Loss on sale of receivables	(1)	(1)
Other	(1)	(1)
Total other income (expense)	(2)	(2)
Earnings before interest expense, income taxes, and noncontrolling interests	113	93
Interest expense (net of interest capitalized of $1 million for both three months ended March 31, 2014 and 2013, respectively)	19	20
Earnings before income taxes and noncontrolling interests	94	73
Income tax expense	40	12
Net income	54	61
Less: Net income attributable to noncontrolling interests	8	7
Net income attributable to Tenneco Inc.	$ 46	$ 54
Weighted average shares of common stock outstanding —
Basic (in shares)	60,549,778	60,288,997
Diluted (in shares)	61,503,302	61,481,835
Basic earnings per share of common stock (in dollars per share)	$ 0.76	$ 0.90
Diluted earnings per share of common stock (in dollars per share)	$ 0.75	$ 0.88

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Summary of Earnings Per Share of Common Stock (Detail) (USD $) In Millions, except Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Basic earnings per share —
Net income attributable to Tenneco Inc.	$ 46	$ 54
Weighted Average shares of common stock outstanding	60,549,778	60,288,997
Earnings per share of common stock	$ 0.76	$ 0.90
Diluted earnings per share —
Net income attributable to Tenneco Inc.	$ 46	$ 54
Weighted Average shares of common stock outstanding	60,549,778	60,288,997
Effect of dilutive securities:
Restricted stock	160,341	138,594
Stock options	793,183	1,054,244
Weighted Average shares of common stock outstanding including dilutive securities	61,503,302	61,481,835
Earnings per share of common stock	$ 0.75	$ 0.88

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Operating Activities
Net Income	$ 54	$ 61
Adjustments to reconcile net income to cash provided by operating activities —
Depreciation and amortization of other intangibles	51	50
Deferred income taxes	2	(5)
Stock-based compensation	5	5
Loss on sale of assets	1	0
Changes in components of working capital —
(Increase) decrease in receivables	(234)	(176)
(Increase) decrease in inventories	(81)	(40)
(Increase) decrease in prepayments and other current assets	(38)	(49)
Increase (decrease) in payables	87	77
Increase (decrease) in accrued taxes	5	(5)
Increase (decrease) in accrued interest	4	4
Increase (decrease) in other current liabilities	13	(8)
Changes in long-term assets	1	0
Changes in long-term liabilities	(13)	(10)
Other	3	4
Net cash provided by operating activities	(140)	(92)
Investing Activities
Proceeds from the sale of assets	0	2
Cash payments for plant, property, and equipment	(83)	(70)
Cash payments for software related intangible assets	(7)	(6)
Changes in restricted cash	(1)	(9)
Net cash (used) by investing activities	(91)	(83)
Financing Activities
Issuance (repurchase) of common shares	(2)	1
Tax benefit from stock-based compensation	12	0
Retirement of long-term debt	(3)	(5)
Increase (decrease) in bank overdrafts	4	(9)
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivable	197	191
Net increase in short-term borrowings secured by accounts receivable	20	0
Capital contribution from noncontrolling interest partners	1	0
Net cash provided (used) by financing activities	229	178
Effect of foreign exchange rate changes on cash and cash equivalents	(6)	7
Increase (decrease) in cash and cash equivalents	(8)	10
Cash and cash equivalents, January 1	275
Cash and cash equivalents, March 31 (Note)	267	233
Supplemental Cash Flow Information
Cash paid during the period for interest	14	16
Cash paid during the period for income taxes (net of refunds)	21	25
Non-cash Investing and Financing Activities
Period end balance of trade payables for plant, property, and equipment	$ 40	$ 31

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Statement of Cash Flows (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Jun. 30, 2013	Mar. 31, 2013
Operating Activities
Net cash provided (used) by operating activities	$ (140)		$ (92)
Investing Activities
Proceeds from sale of assets	0		2
Cash payments for plant, property, and equipment	(83)		(70)
Cash payments for software related intangible assets	(7)		(6)
Changes in restricted cash	(1)		(9)
Net cash (used) by investing activities	(91)		(83)
Financing Activities
Issuance (repurchase) of common shares	(2)		1
Tax benefit from stock-based compensation	12		0
Retirement of long-term debt	(3)		(5)
Increase (decrease) in bank overdrafts	4		(9)
Net Increase Decrease In Revolver Borrowings And Short Term Debt Excluding Current Maturities Of Long Term Debt And Short Term Borrowings Secured By Accounts Receivable	197		191
Increase Decrease In Secured Short Term Debt		20
Intercompany dividends and net increase (decrease) in intercompany obligations	0		0
Capital contribution from noncontrolling interest partners	1	1	0
Net cash provided (used) by financing activities	229		178
Effect of foreign exchange rate changes on cash and cash equivalents	(6)		7
Increase (decrease) in cash and cash equivalents	(8)		10
Cash and cash equivalents, January 1	275	233
Cash and cash equivalents, March 31 (Note)	267	275	233
Guarantor Subsidiaries
Operating Activities
Net cash provided (used) by operating activities	(208)		(102)
Investing Activities
Proceeds from sale of assets			0
Cash payments for plant, property, and equipment	(25)		(32)
Cash payments for software related intangible assets	(4)		(3)
Changes in restricted cash	0
Net cash (used) by investing activities	(29)		(35)
Financing Activities
Issuance (repurchase) of common shares	0
Tax benefit from stock-based compensation	0
Retirement of long-term debt	0		0
Increase (decrease) in bank overdrafts	0		0
Net Increase Decrease In Revolver Borrowings And Short Term Debt Excluding Current Maturities Of Long Term Debt And Short Term Borrowings Secured By Accounts Receivable	0		0
Increase Decrease In Secured Short Term Debt		0
Intercompany dividends and net increase (decrease) in intercompany obligations	233		137
Capital contribution from noncontrolling interest partners		0
Net cash provided (used) by financing activities	233		137
Effect of foreign exchange rate changes on cash and cash equivalents	0		0
Increase (decrease) in cash and cash equivalents	(4)		0
Cash and cash equivalents, January 1	6	4
Cash and cash equivalents, March 31 (Note)	2	6	4
Non-Guarantor Subsidiaries
Operating Activities
Net cash provided (used) by operating activities	90		15
Investing Activities
Proceeds from sale of assets			2
Cash payments for plant, property, and equipment	(58)		(38)
Cash payments for software related intangible assets	(3)		(3)
Changes in restricted cash	(1)
Net cash (used) by investing activities	(62)		(48)
Financing Activities
Issuance (repurchase) of common shares	0
Tax benefit from stock-based compensation	0
Retirement of long-term debt	0		0
Increase (decrease) in bank overdrafts	4		(9)
Net Increase Decrease In Revolver Borrowings And Short Term Debt Excluding Current Maturities Of Long Term Debt And Short Term Borrowings Secured By Accounts Receivable	24		3
Increase Decrease In Secured Short Term Debt		0
Intercompany dividends and net increase (decrease) in intercompany obligations	(55)		42
Capital contribution from noncontrolling interest partners		1
Net cash provided (used) by financing activities	(26)		36
Effect of foreign exchange rate changes on cash and cash equivalents	(6)		7
Increase (decrease) in cash and cash equivalents	(4)		10
Cash and cash equivalents, January 1	269	229
Cash and cash equivalents, March 31 (Note)	265	269	229
Tenneco Inc
Operating Activities
Net cash provided (used) by operating activities	(22)		(5)
Investing Activities
Proceeds from sale of assets			0
Cash payments for plant, property, and equipment	0		0
Cash payments for software related intangible assets	0		0
Changes in restricted cash	0
Net cash (used) by investing activities	0		0
Financing Activities
Issuance (repurchase) of common shares	(2)
Tax benefit from stock-based compensation	12
Retirement of long-term debt	(3)		(5)
Increase (decrease) in bank overdrafts			0
Net Increase Decrease In Revolver Borrowings And Short Term Debt Excluding Current Maturities Of Long Term Debt And Short Term Borrowings Secured By Accounts Receivable	173		188
Increase Decrease In Secured Short Term Debt		20
Intercompany dividends and net increase (decrease) in intercompany obligations	(178)		(179)
Capital contribution from noncontrolling interest partners		0
Net cash provided (used) by financing activities	22		5
Effect of foreign exchange rate changes on cash and cash equivalents	0		0
Increase (decrease) in cash and cash equivalents	0		0
Cash and cash equivalents, January 1	0	0
Cash and cash equivalents, March 31 (Note)	0	0	0
Reclass and Elims
Operating Activities
Net cash provided (used) by operating activities	0		0
Investing Activities
Proceeds from sale of assets			0
Cash payments for plant, property, and equipment	0		0
Cash payments for software related intangible assets	0		0
Changes in restricted cash	0
Net cash (used) by investing activities	0		0
Financing Activities
Issuance (repurchase) of common shares	0
Tax benefit from stock-based compensation	0
Retirement of long-term debt	0		0
Increase (decrease) in bank overdrafts	0		0
Net Increase Decrease In Revolver Borrowings And Short Term Debt Excluding Current Maturities Of Long Term Debt And Short Term Borrowings Secured By Accounts Receivable	0		0
Increase Decrease In Secured Short Term Debt		0
Intercompany dividends and net increase (decrease) in intercompany obligations	0		0
Capital contribution from noncontrolling interest partners		0
Net cash provided (used) by financing activities	0		0
Effect of foreign exchange rate changes on cash and cash equivalents	0		0
Increase (decrease) in cash and cash equivalents	0		0
Cash and cash equivalents, January 1		0
Cash and cash equivalents, March 31 (Note)	$ 0	$ 0	$ 0

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Summarization for Foreign Currency Forward Purchase and Sale Contracts (Detail) In Millions, unless otherwise specified	Mar. 31, 2014 USD ($)	Dec. 31, 2013 USD ($)	Mar. 31, 2014 Long [Member] Foreign Exchange Forward Contracts [Member] Australian dollars [Member] AUD	Mar. 31, 2014 Long [Member] Foreign Exchange Forward Contracts [Member] British pounds [Member] GBP (£)	Mar. 31, 2014 Long [Member] Foreign Exchange Forward Contracts [Member] Canada, Dollars CAD	Mar. 31, 2014 Long [Member] Foreign Exchange Forward Contracts [Member] European euro [Member] EUR (€)	Mar. 31, 2014 Long [Member] Foreign Exchange Forward Contracts [Member] South African Rand [Member] ZAR	Mar. 31, 2014 Long [Member] Foreign Exchange Forward Contracts [Member] Japanese yen [Member] JPY (¥)	Mar. 31, 2014 Long [Member] Foreign Exchange Forward Contracts [Member] Polish Zloty [Member] PLN	Mar. 31, 2014 Long [Member] Foreign Exchange Forward Contracts [Member] U.S. dollars [Member] USD ($)	Mar. 31, 2014 Short [Member] Foreign Exchange Forward Contracts [Member] British pounds [Member] GBP (£)	Mar. 31, 2014 Short [Member] Foreign Exchange Forward Contracts [Member] Canada, Dollars CAD	Mar. 31, 2014 Short [Member] Foreign Exchange Forward Contracts [Member] European euro [Member] EUR (€)	Mar. 31, 2014 Short [Member] Foreign Exchange Forward Contracts [Member] Japanese yen [Member] JPY (¥)	Mar. 31, 2014 Short [Member] Foreign Exchange Forward Contracts [Member] U.S. dollars [Member] USD ($)
Derivative [Line Items]
Derivative, Notional Amount			2	£ 31	12	€ 8	222	¥ 196	21	$ 16	£ 5	2	€ 15	¥ 461	$ 84
Negotiable Financial Instruments Collected Before Maturity Date And Sold At Discount	$ 6	$ 5

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Long-Term Debt and Financing Arrangements (Tables)

3 Months Ended

Mar. 31, 2014

Debt Disclosure [Abstract]

Financial Ratios under Senior Credit Facility

The financial ratios required under the amended and restated senior credit facility, and the actual ratios we achieved for the first quarter of 2014, are as follows:

	Quarter Ended
	March 31, 2014
	Required	Actual
Leverage Ratio (maximum)	3.50	1.63
Interest Coverage Ratio (minimum)	2.75	10.39

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Financial Instruments - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Financial Instruments [Line Items]
Maximum percentage of stock of certain first tier foreign subsidiaries pledged to secure senior credit facility	66.00%
Line of credit facility letters of credit outstanding	$ 38
Negotiable Financial Instruments Collected Before Maturity Date And Sold At Discount	6	5
Negotiable Financial Instruments Not Redeemed And Used For Vendor Payment	21	13
Negotiable financial instruments received from one customer not redeemed	20	12
Negotiable financial instruments received classified as other current assets	20	12
Extended Payment Term	11
Restricted cash	6	5
TMEL and Walker Plans [Member]
Financial Instruments [Line Items]
Number of performance guarantee agreements	2
Number of group benefit plans under the agreement	2
Maximum amount payable for pension performance guarantees	32
Percentage of liability considered to determine maximum amount payable for pension performance guarantees	105.00%
Percentage of the pension obligation recognized for participating employers	100.00%
Pension obligation of participating employers recognized on the balance sheet	9	10
TMEL and Futaba [Member]
Financial Instruments [Line Items]
Maximum amount reimbursable under indemnity agreement	6
Australia [Member]
Financial Instruments [Line Items]
Number of subsidiaries	2
Restricted cash	5
CHINA
Financial Instruments [Line Items]
Restricted cash	$ 1

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Environmental Matters, Litigation and Product Warranties (Tables)

3 Months Ended

Mar. 31, 2014

Environmental Matters, Litigation and Product Warranties [Abstract]

Warranty Accrual Rollforward

Below is a table that shows the activity in the warranty accrual accounts:

	Three Months Ended March 31,
	2014			2013
	(Millions)
Beginning Balance January 1,	$	24		$	23
Accruals related to product warranties	5			2
Reductions for payments made	(5		)	(4		)
Ending Balance March 31,	$	24		$	21

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY (USD $) In Millions, except Share data, unless otherwise specified	Total	Common Stock	Premium on Common Stock and Other Capital Surplus	Accumulated Other Comprehensive Loss	Retained Earnings (Accumulated Deficit)	Less — Common Stock Held as Treasury Stock, at Cost	Tenneco Inc.	Noncontrolling Interests
Balance January 1 at Dec. 31, 2012
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Premium on common stock issued pursuant to benefit plans			$ 6
Other comprehensive income (loss)				(22)				0
Net income attributable to Tenneco Inc.	54				54
Net income								5
Purchase of common stock through stock repurchase program, Shares						0
Purchase of common stock through stock repurchase program						0
Issued pursuant to benefit plans		160,827
Stock options exercised	25,595	97,622
Balance March 31 at Mar. 31, 2013	334	1	3,037	(430)	(2,050)	274	284	50
Balance March 31 at Mar. 31, 2013		63,047,831				2,294,692
Balance January 1 at Dec. 31, 2013	472	1	3,014	(360)	(1,921)	301		39
Balance January 1 at Dec. 31, 2013		63,714,728				2,844,692
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Premium on common stock issued pursuant to benefit plans			15
Other comprehensive income (loss)				(3)				(1)
Net income attributable to Tenneco Inc.	46				46
Net income								4
Purchase of common stock through stock repurchase program, Shares						0
Purchase of common stock through stock repurchase program						0
Issued pursuant to benefit plans		82,743
Stock options exercised		25,595
Balance March 31 at Mar. 31, 2014	$ 533	$ 1	$ 3,029	$ (363)	$ (1,875)	$ 301	$ 491	$ 42
Balance March 31 at Mar. 31, 2014		63,823,066				2,844,692

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CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Parenthetical) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Income Statement [Abstract]
Capitalized interest	$ 1	$ 1

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Pension Plans, Postretirement and Other Employee Benefits

3 Months Ended

Mar. 31, 2014

Compensation and Retirement Disclosure [Abstract]

Pension Plans, Postretirement and Other Employee Benefits

Pension Plans, Postretirement and Other Employee Benefits

Net periodic pension costs and postretirement benefit costs consist of the following components:

	Three Months Ended March 31,
	Pension												Postretirement
	2014						2013						2014			2013
	US			Foreign			US			Foreign			US			US
	(Millions)
Service cost — benefits earned during the period	$	—		$	2		$	—		$	2		$	—		$	—
Interest cost	5			5			5			4			1			1
Expected return on plan assets	(6		)	(6		)	(5		)	(5		)	—			—
Net amortization:
Actuarial loss	2			2			2			3			1			1
Prior service cost (credit)	—			—			—			—			(2		)	(1		)
Net pension and postretirement costs	$	1		$	3		$	2		$	4		$	—		$	1

For the three months ended March 31, 2014, we made pension contributions of $7 million and $4 million for our domestic and foreign pension plans, respectively. Based on current actuarial estimates, we believe we will be required to contribute approximately $36 million for the remainder of 2014. Pension contributions beyond 2014 will be required, but those amounts will vary based upon many factors including, for example, the performance of our pension fund investments during 2014.

We made postretirement contributions of approximately $2 million during the first three months of 2014. Based on current actuarial estimates, we believe we will be required to contribute approximately $6 million for the remainder of 2014.

The assets of some of our pension plans are invested in trusts that permit commingling of the assets of more than one employee benefit plan for investment and administrative purposes. Each of the plans participating in the trust has interests in the net assets of the underlying investment pools of the trusts. The investments for all our pension plans are recorded at estimated fair value, in compliance with the accounting guidance on fair value measurement.

Amounts recognized for pension and postretirement benefits in other comprehensive income for the three periods ended March 31, 2014 and 2013 include the following components:

	Three Months Ended March 31,
	2014							2013
	Before-Tax Amount		Tax Benefit			Net-of-Tax Amount		Before- Tax Amount			Tax Benefit			Net-of-Tax Amount
	(Millions)
Defined benefit pension and postretirement plans:
Amortization of prior service cost included in net periodic pension and postretirement cost	$	—	$	—		$	—	$	(1	)	$	—		$	(1	)
Amortization of actuarial loss included in net periodic pension and postretirement cost	4		(1		)	3		6			(1		)	5
Other comprehensive income – pension benefits	$	4	$	(1	)	$	3	$	5		$	(1	)	$	4

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Document and Entity Information	3 Months Ended
	Mar. 31, 2014	May 02, 2014
Document and Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q1
Entity Registrant Name	TENNECO INC
Entity Central Index Key	0001024725
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		60,881,474

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New Accounting Pronouncements

3 Months Ended

Mar. 31, 2014

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

New Accounting Pronouncements

New Accounting Pronouncements

In July 2013, the Financial Accounting Standards Board (“FASB”) issued an amendment to provide explicit guidance on financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, similar tax loss, or tax credit carryforward exists. The objective of the amendment is to eliminate the diversity in practice in the presentation of unrecognized tax benefits in those instances. This amendment is effective for reporting periods beginning after December 15, 2013. We adopted this amendment on January 1, 2014. This amendment did not have a material impact on our consolidated financial statements.

In April 2013, the FASB issued an amendment to clarify when an entity should apply the liquidation basis of accounting and to provide principles for the measurement of assets and liabilities under the liquidation basis of accounting, as well as any required disclosures. The amendment applies to all entities that issue financial statements that are presented in conformity with U.S. GAAP except investment companies that are regulated under the Investment Company Act of 1940. This amendment is effective for reporting periods beginning after December 15, 2013. This amendment did not have any impact on our consolidated financial statements.

In February 2013, the FASB issued an amendment to resolve the diversity in practice about whether Subtopic 810-10, Consolidation-Overall, or Subtopic 830-30, Foreign Currency Matters-Translation of Financial Statements, applies to the release of the cumulative translation adjustment into net income when a parent either sells a part of all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business (other than a sale of in substance real state or conveyance of oil and gas mineral rights) within a foreign entity. In addition, the amendments resolve the diversity in practice for the treatment of business combinations achieved in stages (sometimes also referred to as step acquisitions) involving a foreign entity. This amendment is effective for reporting periods beginning after December 15, 2013. This amendment did not have any impact on our consolidated financial statements.

In February 2013, the FASB issued an amendment to the accounting guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation is fixed at the reporting date, except for obligations addressed within existing guidance in U.S. GAAP. The guidance requires an entity to measure those obligations as the sum of the amount the reporting entity agreed to pay on the basis of its arrangement amount its co-obligors and any additional amount the reporting entity expects to pay on behalf of its co-obligors. The guidance in this amendment also requires an entity to disclose the nature and amount of the obligation as well as other information about those obligations. This amendment is effective for reporting periods beginning after December 15, 2013. This amendment did not have any impact on our consolidated financial statements.

In February 2013, the FASB issued an amendment to the accounting guidance to improve the transparency of reporting amounts reclassified out of other comprehensive income. Other comprehensive income (loss) includes gains and losses that are initially excluded from net income for an accounting period. Those gains and losses are later reclassified out of accumulated other comprehensive income into net income. This amendment does not change the current requirements for reporting net income or other comprehensive income in the financial statements. All of the information that this amendment requires already is required to be disclosed elsewhere in the financial statements under U.S. GAAP. This new amendment requires presentation either on the face of the statement where net income is presented or in the notes, the effects of significant amounts reclassified out of accumulated other comprehensive income, and that the reclassified amounts be cross-referenced to the other disclosures required under U.S. GAAP. This amendment was effective for reporting periods beginning after December 15, 2012. This amendment did not have a material impact on our condensed consolidated financial statements.

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	$ 54	$ 61
Translation of foreign currency statements	(8)	(26)
Additional Liability for Pension and Postretirement Benefits, net of tax	3	4
Other Comprehensive Loss	(5)	(22)
Comprehensive Income	49	39
Cumulative Translation Adjustment
Balance January 1	(56)	(19)
Translation of foreign currency statements	(8)	(26)
Balance March 31	(64)	(45)
Additional Liability for Pension and Postretirement Benefits
Balance January 1	(299)	(384)
Additional Liability for Pension and Postretirement Benefits, net of tax	3	4
Balance March 31	(296)	(380)
Balance March 31	(360)	(425)
Tenneco Inc.
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	46	54
Translation of foreign currency statements	(6)	(26)
Additional Liability for Pension and Postretirement Benefits, net of tax	3	4
Other Comprehensive Loss	(3)	(22)
Comprehensive Income	43	32
Cumulative Translation Adjustment
Balance January 1	(61)	(24)
Translation of foreign currency statements	(6)	(26)
Balance March 31	(67)	(50)
Additional Liability for Pension and Postretirement Benefits
Balance January 1	(299)	(384)
Additional Liability for Pension and Postretirement Benefits, net of tax	3	4
Balance March 31	(296)	(380)
Balance March 31	(363)	(430)
Noncontrolling Interests
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	8	7
Translation of foreign currency statements	(2)	0
Other Comprehensive Loss	(2)	0
Comprehensive Income	6	7
Cumulative Translation Adjustment
Balance January 1	5	5
Translation of foreign currency statements	(2)	0
Balance March 31	3	5
Additional Liability for Pension and Postretirement Benefits
Balance January 1	0	0
Balance March 31	0	0
Balance March 31	$ 3	$ 5

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Accounts Receivable Securitization

3 Months Ended

Mar. 31, 2014

Disclosure Accounts Receivables Additional Information [Abstract]

Accounts Receivable Securitization

Accounts Receivable Securitization

We securitize some of our accounts receivable on a limited recourse basis in North America and Europe. As servicer under these accounts receivable securitization programs, we are responsible for performing all accounts receivable administration functions for these securitized financial assets including collections and processing of customer invoice adjustments. In North America, we have an accounts receivable securitization program with three commercial banks comprised of a first priority facility and a second priority facility. We securitize original equipment and aftermarket receivables on a daily basis under the bank program. In March 2014, the North American program was amended and extended to March 20, 2015. The first priority facility continues to provide financing of up to $110 million and the second priority facility, which is subordinated to the first priority facility, continues to provide up to an additional $40 million of financing. Both facilities monetize accounts receivable generated in the U.S. and Canada that meet certain eligibility requirements, and the second priority facility also monetizes certain accounts receivable generated in the U.S. and Canada that would otherwise be ineligible under the first priority securitization facility. The amount of outstanding third-party investments in our securitized accounts receivable under the North American program was $30 million at March 31, 2014 and $10 million at December 31, 2013.

Each facility contains customary covenants for financings of this type, including restrictions related to liens, payments, mergers or consolidations and amendments to the agreements underlying the receivables pool. Further, each facility may be terminated upon the occurrence of customary events (with customary grace periods, if applicable), including breaches of covenants, failure to maintain certain financial ratios, inaccuracies of representations and warranties, bankruptcy and insolvency events, certain changes in the rate of default or delinquency of the receivables, a change of control and the entry or other enforcement of material judgments. In addition, each facility contains cross-default provisions, where the facility could be terminated in the event of non-payment of other material indebtedness when due and any other event which permits the acceleration of the maturity of material indebtedness.

We also securitize receivables in our European operations with regional banks in Europe under various separate facilities. The commitments for these arrangements are generally for one year, but some may be canceled with notice 90 days prior to renewal. In some instances, the arrangement provides for cancellation by the applicable financial institution at any time upon 15 days, or less, notification. The amount of outstanding third-party investments in our securitized accounts receivable in Europe was $175 million and $134 million at March 31, 2014 and December 31, 2013, respectively.

If we were not able to securitize receivables under either the North American or European securitization programs, our borrowings under our revolving credit agreement might increase. These accounts receivable securitization programs provide us with access to cash at costs that are generally favorable to alternative sources of financing, and allow us to reduce borrowings under our revolving credit agreement.

In our North American accounts receivable securitization programs, we transfer a partial interest in a pool of receivables and the interest that we retain is subordinate to the transferred interest. Accordingly, we account for our North American securitization program as a secured borrowing. In our European programs, we transfer accounts receivables in their entirety to the acquiring entities and satisfy all of the conditions established under Accounting Standards Codification (ASC) Topic 860, “Transfers and Servicing,” to report the transfer of financial assets in their entirety as a sale. The proceeds received in exchange for the transfer of accounts receivable under our European securitization programs approximates the fair value of such receivables. We recognized less than $1 million interest expense in each of the three month periods ended March 31, 2014 and 2013 relating to our North American securitization program. In addition, we recognized a loss of $1 million in each of the three month periods ended March 31, 2014 and 2013 on the sale of trade accounts receivable in our European accounts receivable securitization programs, representing the discount from book values at which these receivables were sold to our banks. The discount rate varies based on funding costs incurred by our banks, which averaged approximately three percent during both the first three months of 2014 and 2013, respectively.

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Income Taxes

3 Months Ended

Mar. 31, 2014

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

For interim tax reporting we estimate our annual effective tax rate and apply it to our year to date ordinary income. Jurisdictions with a projected loss for the year or an actual year-to-date loss where no tax benefit can be recognized due to a valuation allowance are excluded from the estimated annual effective tax rate. The impact of including these jurisdictions on the quarterly effective rate calculation could result in a higher or lower effective tax rate during a particular quarter due to the mix and timing of actual earnings versus annual projections. The tax effects of certain unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are excluded from the estimated annual effective tax rate calculation and recognized in the interim period in which they occur.

We reported income tax expense of $40 million and $12 million in the three month periods ended March 31, 2014 and 2013, respectively. The tax expense recorded in the first three months of 2013 included a net tax benefit of $13 million for tax adjustments primarily related to recognizing a U.S. tax benefit for foreign taxes and changes to prior year estimates. U.S. tax benefit for foreign taxes is driven by our ability to claim a U.S. foreign tax credit beginning in 2013. The U.S. foreign tax credit law provides for a credit against U.S. taxes otherwise payable for foreign taxes paid with regard to dividends, interest and royalties paid to us in the U.S.

In 2012, we reversed the tax valuation allowance against our net deferred tax assets in the U.S. based on operating improvements we had made, the outlook for light and commercial vehicle production in the U.S. and the positive impact this should have on our U.S. operations. We now have a federal net operating loss ("NOL") at March 31, 2014 of $5 million, which expires in 2030. The state NOLs expire in various tax years through 2032.

Valuation allowances are established in certain foreign jurisdictions for deferred tax assets based on a “more likely than not” standard. The ability to realize deferred tax assets depends on our ability to generate sufficient taxable income within the carryforward periods provided for in the tax law for each tax jurisdiction. We have considered the following possible sources of taxable income when assessing the realization of our deferred tax assets:

• Future reversals of existing taxable temporary differences;

• Taxable income or loss, based on recent results, exclusive of reversing temporary differences and carryforwards;

• Tax-planning strategies; and

• Taxable income in prior carryback years if carryback is permitted under the relevant tax law.

The valuation allowances recorded against deferred tax assets will impact our provision for income taxes until the valuation allowances are released. Our provision for income taxes will include no tax benefit for losses incurred and no tax expense with respect to income generated in these jurisdictions until the respective valuation allowance is eliminated.

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Restructuring and Other Charges (Tables)

3 Months Ended

Mar. 31, 2014

Restructuring Reserve [Abstract]

Roll Forward of Restructuring Reserve

Amounts related to activities that are part of our restructuring reserves are as follows:

	December 31, 2013 Restructuring Reserve		2014 Expenses	2014 Cash Payments		March 31, 2014 Restructuring Reserve
	(Millions)
Employee Severance, Termination Benefits and Other Related Costs		$44	9	(5	)		$48

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Segment Information

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Segment Information

Segment Information

In connection with the organizational changes announced on February 14, 2013 that aligned our businesses along product lines, effective with the first quarter of 2013, our three prior geographic reportable segments have each been split into two product segments. Beginning with 2013, we are managed and organized along our two major product lines (clean air and ride performance) and three geographic areas (North America; Europe, South America and India; and Asia Pacific), resulting in six operating segments (North America Clean Air, North America Ride Performance, Europe, South America and India Clean Air, Europe, South America and India Ride Performance, Asia Pacific Clean Air and Asia Pacific Ride Performance). Within each geographical area, each operating segment manufactures and distributes either clean air or ride performance products primarily for the original equipment and aftermarket industries. Each of the six operating segments constitutes a reportable segment. Costs related to other business activities, primarily corporate headquarter functions, are disclosed separately from the six operating segments as "Other." We evaluate segment performance based primarily on earnings before interest expense, income taxes, and noncontrolling interests. Products are transferred between segments and geographic areas on a basis intended to reflect as nearly as possible the “market value” of the products. Prior period segment information has been revised to reflect our new reporting segments.

The following table summarizes certain Tenneco Inc. segment information:

	Clean Air Division						Ride Performance Division
	North America		Europe, South America & India		Asia Pacific		North America		Europe, South America & India		Asia Pacific		Other			Reclass & Elims			Total
	(Millions)
At March 31, 2014 and for the Three Months Ended March 31, 2014
Revenues from external customers	$	698	$	506	$	240	$	335	$	263	$	52	$	—		$	—		$	2,094
Intersegment revenues	7		29		—		3		10		9		—			(58		)	—
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	56		9		20		30		16		7		(25		)	—			113
Total assets	1,197		908		563		701		557		219		—			34			4,179
At March 31, 2013 and for the Three Months Ended March 31, 2013
Revenues from external customers	646		467		183		307		252		48		—			—			1,903
Intersegment revenues	1		31		—		2		12		7		—			(53		)	—
EBIT, Earnings (loss) before interest expense, income taxes, and noncontrolling interests	49		11		15		25		10		4		(21		)	—			93
Total assets	1,144		833		469		645		557		207		—			23			3,878

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Earnings Per Share

3 Months Ended

Mar. 31, 2014

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share

Earnings per share of common stock outstanding were computed as follows:

	Three Months Ended March 31, 2014		Three Months Ended March 31, 2013
	(Millions Except Share and Per Share Amounts)
Basic earnings per share —
Net income attributable to Tenneco Inc.	$	46	$	54
Weighted Average shares of common stock outstanding	60,549,778		60,288,997
Earnings per share of common stock	$	0.76	$	0.90
Diluted earnings per share —
Net income attributable to Tenneco Inc.	$	46	$	54
Weighted Average shares of common stock outstanding	60,549,778		60,288,997
Effect of dilutive securities:
Restricted stock	160,341		138,594
Stock options	793,183		1,054,244
Weighted Average shares of common stock outstanding including dilutive securities	61,503,302		61,481,835
Earnings per share of common stock	$	0.75	$	0.88

Options to purchase 782 and 831,243 shares of common stock were outstanding as of March 31, 2014 and 2013, respectively, but not included in the computation of diluted earnings per share respectively, because the options were anti-dilutive.

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Restructuring and Other Charges

3 Months Ended

Mar. 31, 2014

Restructuring Reserve [Abstract]

Restructuring and Other Charges

Restructuring and Other Charges

Over the past several years, we have adopted plans to restructure portions of our operations. These plans were approved by our Board of Directors and were designed to reduce operational and administrative overhead costs throughout the business. In 2013, we incurred $78 million in restructuring and related costs, primarily related to European cost reduction efforts including non-cash asset write downs of $3 million, our exit from the distribution of aftermarket exhaust products and ending production of leaf springs in Australia, headcount reductions in various regions and the net impact of freezing our defined benefits plans in the United Kingdom, of which $70 million was recorded in cost of sales and $6 million was recorded in SG&A, $1 million in engineering expense and $1 million in other expense. In the first quarter of 2014, we incurred $10 million in restructuring and related costs, primarily related to European cost reduction efforts including non-cash asset write downs of $1 million, all of which was recorded in cost of sales. During the first quarter of 2013, we incurred $4 million in restructuring and related costs, primarily related to European cost reduction efforts and the costs to exit the distribution of aftermarket exhaust products in Australia, of which $3 million was recorded in cost of sales and $1 million was recorded in SG&A.

Amounts related to activities that are part of our restructuring reserves are as follows:

	December 31, 2013 Restructuring Reserve		2014 Expenses	2014 Cash Payments		March 31, 2014 Restructuring Reserve
	(Millions)
Employee Severance, Termination Benefits and Other Related Costs		$44	9	(5	)		$48

Under the terms of our amended and restated senior credit agreement that took effect on March 22, 2012, we are allowed to exclude $80 million of cash charges and expenses, before taxes, related to cost reduction initiatives incurred after March 22, 2012 from the calculation of the financial covenant ratios required under our senior credit facility. As of December 31, 2013, we had excluded all allowable charges relating to restructuring initiatives against the $80 million available under the terms of the senior credit facility.

On January 31, 2013, we announced our intent to reduce structural costs in Europe. This initiative includes the non-cash charges of $4 million we incurred in 2012 in connection with the announced closing of the Vittaryd facility in Sweden and a $7 million charge recorded in the fourth quarter of 2012 related to the impairment of certain assets in the European ride performance business. In August 2013, we completed the closure of the Vittaryd facility. As part of our European structural cost reduction initiative, on September 5, 2013 we announced our intent to close our ride performance plant in Gijon, Spain and reduce the workforce at our ride performance plant in Sint-Truiden, Belgium. The actions were subject to consultation with the relevant employee representatives. We concluded the consultation period with employee representatives at Gijon without having reached agreement and on December 17, 2013 notified the Gijon employees' works council that the Company was proceeding with the plant closure. Employee terminations at Gijon were completed by the end of 2013. During the first quarter of 2014, the employees' works council filed suit challenging the decision to close the Gijon plant and local High Court of Justice of Asturias ruled in favor of the employees' works council. On February 25, 2014, we announced the intention of the Company to appeal that decision to the Supreme Court of Spain in Madrid, and at the same time we are working closely with local and European government officials to reach a solution that will address the challenge to our restructuring plan by the Gijon plant's employees' works council. Negotiations with employee representatives at Sint-Truiden are continuing. We recorded $60 million in 2013 and $2 million in the first quarter of 2014 related to these actions at Gijon and Sint-Truiden. In the first quarter of 2014, we announced and finalized the closure of the clean air just-in-time plant in Iwuy, France, due to reduced demand for the plant's products. The actions were subject to the required consultation process with the relevant employee representatives.

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Environmental Matters, Litigation and Product Warranties

3 Months Ended

Mar. 31, 2014

Environmental Matters, Litigation and Product Warranties [Abstract]

Environmental Matters, Litigation and Product Warranties

Environmental Matters, Legal Proceedings and Product Warranties

We are involved in environmental remediation matters, legal proceedings, claims, investigations and warranty obligations. These matters are typically incidental to the conduct of our business and create the potential for contingent losses. We accrue for potential contingent losses when our review of available facts indicates that it is probable a loss has been incurred and the amount of the loss is reasonably estimable. Each quarter we assess our loss contingencies based upon currently available facts, existing technology, presently enacted laws and regulations and taking into consideration the likely effects of inflation and other societal and economic factors and record adjustments to these reserves as required. As an example, we consider all available evidence, including prior experience in remediation of contaminated sites, other companies’ cleanup experiences and data released by the United States Environmental Protection Agency or other organizations when we evaluate our environmental remediation contingencies. All of our loss contingency estimates are subject to revision in future periods based on actual costs or new information. With respect to our environmental liabilities, where future cash flows are fixed or reliably determinable, we have discounted those liabilities. We evaluate recoveries separately from the liability and, when they are assured, recoveries are recorded and reported separately from the associated liability in our consolidated financial statements.

Environmental Matters

We are subject to a variety of environmental and pollution control laws and regulations in all jurisdictions in which we operate. We expense or capitalize, as appropriate, expenditures for ongoing compliance with environmental regulations that relate to current operations. We expense costs related to an existing condition caused by past operations that do not contribute to current or future revenue generation. As of March 31, 2014, we have the obligation to remediate or contribute towards the remediation of certain sites, including one Federal Superfund site. At March 31, 2014, our aggregated estimated share of environmental remediation costs for all these sites on a discounted basis was approximately $15 million, of which $3 million is recorded in other current liabilities and $12 million is recorded in deferred credits and other liabilities in our condensed consolidated balance sheet. For those locations where the liability was discounted, the weighted average discount rate used was 2.50 percent. The undiscounted value of the estimated remediation costs was $19 million. Our expected payments of environmental remediation costs are estimated to be approximately $3 million in 2014, $1 million in 2015, $1 million each year beginning 2016 through 2018 and $12 million in aggregate thereafter.

Based on information known to us, we have established reserves that we believe are adequate for these costs. Although we believe these estimates of remediation costs are reasonable and are based on the latest available information, the costs are estimates and are subject to revision as more information becomes available about the extent of remediation required. At some sites, we expect that other parties will contribute to the remediation costs. In addition, certain environmental statutes provide that our liability could be joint and several, meaning that we could be required to pay in excess of our share of remediation costs. Our understanding of the financial strength of other potentially responsible parties at these sites has been considered, where appropriate, in our determination of our estimated liability. We do not believe that any potential costs associated with our current status as a potentially responsible party in the Federal Superfund site, or as a liable party at the other locations referenced herein, will be material to our consolidated financial position, results of operations, or liquidity.

Antitrust Investigations

On March 25, 2014, representatives of the European Commission were at Tenneco GmbH's Edenkoben, Germany administrative facility to gather information in connection with an ongoing global antitrust investigation concerning multiple automotive suppliers. On March 25, 2014, we also received a related subpoena from the U.S. Department of Justice. We have cooperated and continue to cooperate fully with these antitrust investigations, and take other actions to minimize our potential exposure. Antitrust law investigations and related matters often continue for several years and can result in significant penalties and liability. At this point, we cannot estimate the ultimate impact on our company from investigations into our antitrust compliance and related matters in light of the uncertainties and many variables involved, and there can be no assurance that the ultimate resolution of these matters will not have a material adverse effect on our consolidated financial position, results of operations or liquidity.

Other Legal Proceedings, Claims and Investigations

We are also from time to time involved in other legal proceedings, claims or investigations. Some of these matters involve allegations of damages against us relating to environmental liabilities (including toxic tort, property damage and remediation), intellectual property matters (including patent, trademark and copyright infringement, and licensing disputes), personal injury claims (including injuries due to product failure, design or warning issues, and other product liability related matters), taxes, employment matters, and commercial or contractual disputes, sometimes related to acquisitions or divestitures. Additionally, some of these matters involve allegations relating to legal compliance. For example, one of our Argentine subsidiaries is currently defending against a criminal complaint alleging the failure to comply with laws requiring the proceeds of export transactions to be collected, reported and/or converted to local currency within specified time periods. As another example, in the U.S. we are subject to an audit in 11 states with respect to the payment of unclaimed property to those states, spanning a period as far back as over 30 years. While we vigorously defend ourselves against all of these legal proceedings, claims and investigations and take other actions to minimize our potential exposure, in future periods, we could be subject to cash costs or charges to earnings if any of these matters are resolved on unfavorable terms. Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on current information, including our assessment of the merits of the particular claim, except as described above under "Antitrust Investigations," we do not expect the legal proceedings, claims or investigations currently pending against us will have any material adverse impact on our consolidated financial position, results of operations or liquidity.

In addition, we are subject to lawsuits initiated by a significant number of claimants alleging health problems as a result of exposure to asbestos. In the early 2000's we were named in nearly 20,000 complaints, most of which were filed in Mississippi state court and the vast majority of which made no allegations of exposure to asbestos from our product categories. Most of these claims have been dismissed and our current docket of active and inactive cases is less than 500 cases nationwide. A small number of claims have been asserted by railroad workers alleging exposure to asbestos products in railroad cars manufactured by The Pullman Company, one of our subsidiaries. The substantial majority of the remaining claims are related to alleged exposure to asbestos in our automotive products. Only a small percentage of the claimants allege that they were automobile mechanics and a significant number appear to involve workers in other industries or otherwise do not include sufficient information to determine whether there is any basis for a claim against us. We believe, based on scientific and other evidence, it is unlikely that mechanics were exposed to asbestos by our former products and that, in any event, they would not be at increased risk of asbestos-related disease based on their work with these products. Further, many of these cases involve numerous defendants, with the number in some cases exceeding 100 defendants from a variety of industries. Additionally, the plaintiffs either do not specify any, or specify the jurisdictional minimum, dollar amount for damages. As major asbestos manufacturers and/or users continue to go out of business or file for bankruptcy, we may experience an increased number of these claims. We vigorously defend ourselves against these claims as part of our ordinary course of business. In future periods, we could be subject to cash costs or charges to earnings if any of these matters are resolved unfavorably to us. To date, with respect to claims that have proceeded sufficiently through the judicial process, we have regularly achieved favorable resolutions. Accordingly, we presently believe that these asbestos-related claims will not have a material adverse impact on our future consolidated financial position, results of operations or liquidity.

Warranty Matters

We provide warranties on some of our products. The warranty terms vary but range from one year up to limited lifetime warranties on some of our premium aftermarket products. Provisions for estimated expenses related to product warranty are made at the time products are sold or when specific warranty issues are identified on OE products. These estimates are established using historical information about the nature, frequency, and average cost of warranty claims. We actively study trends of our warranty claims and take action to improve product quality and minimize warranty claims. We believe that the warranty reserve is appropriate; however, actual claims incurred could differ from the original estimates, requiring adjustments to the reserve. The reserve is included in both current and long-term liabilities on the balance sheet.

Below is a table that shows the activity in the warranty accrual accounts:

	Three Months Ended March 31,
	2014			2013
	(Millions)
Beginning Balance January 1,	$	24		$	23
Accruals related to product warranties	5			2
Reductions for payments made	(5		)	(4		)
Ending Balance March 31,	$	24		$	21

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Common Stock

3 Months Ended

Mar. 31, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Common Stock

Common Stock

Equity Plans — We have granted a variety of awards, including common stock, restricted stock, restricted stock units, performance units, stock appreciation rights (“SARs”), and stock options to our directors, officers, and employees.

Accounting Methods — We have recorded $2 million in compensation expense in each of the three month periods ended March 31, 2014 and 2013 related to nonqualified stock options as part of our selling, general and administrative expense. This resulted in a decrease of $0.04 in both basic and diluted earnings per share for the three month period ended March 31, 2014 and a decrease of $0.04 and $0.03 in basic and diluted earnings per share, respectively, for the three month period ended March 31, 2013.

For employees eligible to retire at the grant date, we immediately expense stock options and restricted stock. If employees become eligible to retire during the vesting period, we immediately recognize any remaining expense associated with their stock options and restricted stock.

As of March 31, 2014, there was approximately $9 million of unrecognized compensation costs related to our stock option awards that we expect to recognize over a weighted average period of 1.6 years.

Compensation expense for restricted stock, restricted stock units, long-term performance units and SARs was $8 million and $5 million for the three months ended March 31, 2014 and 2013, respectively, and was recorded in selling, general, and administrative expense in our condensed consolidated statements of income.

Cash received from stock option exercises for the quarter ended March 31, 2014 was less than $1 million and was $2 million for the quarter ended March 31, 2013.

Stock options exercised in the quarter ended March 31, 2013 would have generated a tax benefit of $1 million, however in 2013 we did not begin to record this tax benefit until the third quarter 2013 when we began utilizing our federal and state NOLs. In the first quarter of 2014, we recorded a tax benefit of $12 million, all of which was related to the historic tax benefit on stock options from 2011 through 2013.

Assumptions — We calculated the fair values of stock option awards using the Black-Scholes option pricing model with the weighted average assumptions listed below. The fair value of share-based awards is determined at the time the awards are granted which is generally in January of each year, and requires judgment in estimating employee and market behavior.

	Three Months Ended March 31,
	2014			2013
Stock Options Granted
Weighted average grant date fair value, per share	$	26.46		$	19.84
Weighted average assumptions used:
Expected volatility	52.8		%	66.4		%
Expected lives	5.0			4.9
Risk-free interest rates	1.7		%	0.7		%
Dividend yields	—		%	—		%

Expected volatility is calculated based on current implied volatility and historical realized volatility for the Company.

Expected lives of options are based upon the historical and expected time to post-vesting forfeiture and exercise. We believe this method is the best estimate of the future exercise patterns currently available.

The risk-free interest rates are based upon the Constant Maturity Rates provided by the U.S. Treasury. For our valuations, we used the continuous rate with a term equal to the expected life of the options.

Stock Options — The following table reflects the status and activity for all options to purchase common stock for the period indicated:

	Three Months Ended March 31, 2014
	Shares Under Option		Weighted Avg. Exercise Prices		Weighted Avg. Remaining Life in Years	Aggregate Intrinsic Value
						(Millions)
Outstanding Stock Options
Outstanding, January 1, 2014	1,983,573		$	22.93	4.5	$	62
Granted	192,624		56.23
Canceled	(31,299	)	19.78
Forfeited	(300	)	22.77
Exercised	(25,595	)	14.72			1
Outstanding, March 31, 2014	2,119,003		$	26.10	4.6	$	67

The weighted average grant-date fair value of options granted during the three months ended March 31, 2014 and 2013 was $26.46 and $19.84, respectively. The total fair value of shares vested was $6 million and $5 million for the periods ended March 31, 2014 and 2013, respectively.

Restricted Stock — The following table reflects the status for all nonvested restricted shares for the period indicated:

	Three Months Ended March 31, 2014
	Shares		Weighted Avg. Grant Date Fair Value
Nonvested Restricted Shares
Nonvested balance at January 1, 2014	368,268		$	34.90
Granted	131,561		54.90
Vested	(186,112	)	36.57
Forfeited	—		—
Nonvested balance at March 31, 2014	313,717		$	42.30

The fair value of restricted stock grants is equal to the average of the high and low trading price of our stock on the date of grant. As of March 31, 2014, approximately $10 million of total unrecognized compensation costs related to restricted stock awards is expected to be recognized over a weighted-average period of approximately 2.2 years. The total fair value of restricted shares vested was $7 million and $5 million at March 31, 2014 and 2013, respectively.

In January 2014, our Board of Directors approved a share repurchase program, authorizing our company to repurchase up to 400,000 shares of our outstanding common stock over a 12 month period. This share repurchase program is intended to offset dilution from shares of restricted stock and stock options issued in 2014 to employees. We did not purchase any shares through this program in the three month period ended March 31, 2014.

These repurchased shares are held as part of our treasury stock which was at 2,844,692 shares at both March 31, 2014 and December 31, 2013.

Long-Term Performance Units, Restricted Stock Units and SARs — Long-term performance units, restricted stock units and SARs are paid in cash and recognized as a liability based upon their fair value. As of March 31, 2014, $26 million of total unrecognized compensation costs is expected to be recognized over a weighted-average period of approximately 2.1 years.

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Fair Value of Financial Assets on Recurring Basis (Detail) (Level 2 [Member], Foreign Exchange Forward Contracts [Member], Fair Value, Measurements, Recurring [Member], USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Level 2 [Member] | Foreign Exchange Forward Contracts [Member] | Fair Value, Measurements, Recurring [Member]
Financial Assets:
Foreign exchange forward contracts	$ 1	$ 0

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Components of Net Periodic Benefit Cost (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
United States Pension Plans of US Entity, Defined Benefit [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost — benefits earned during the period	$ 0	$ 0
Interest cost	5	5
Expected return on plan assets	(6)	(5)
Net amortization:
Actuarial loss	2	2
Prior service cost (credit)	0	0
Net pension and postretirement costs	1	2
Foreign Pension Plans, Defined Benefit [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost — benefits earned during the period	2	2
Interest cost	5	4
Expected return on plan assets	(6)	(5)
Net amortization:
Actuarial loss	2	3
Prior service cost (credit)	0	0
Net pension and postretirement costs	3	4
United States Postretirement Benefit Plans of US Entity, Defined Benefit [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost — benefits earned during the period	0	0
Interest cost	1	1
Expected return on plan assets	0	0
Net amortization:
Actuarial loss	1	1
Prior service cost (credit)	(2)	(1)
Net pension and postretirement costs	$ 0	$ 1

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Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2014

Fair Value Disclosures [Abstract]

Carrying and Estimated Fair Value

The carrying and estimated fair values of our financial instruments by class at March 31, 2014 and December 31, 2013 were as follows:

	March 31, 2014				December 31, 2013
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(Millions)
Long-term debt (including current maturities)	$	1,211	$	1,275	$	1,021	$	1,089
Instruments with off-balance sheet risk:
Foreign exchange forward contracts:
Asset derivative contracts	1		1		—		—

Foreign Exchange Forward Contracts Fair Value on Gross Basis

The fair value of our foreign exchange forward contracts, presented on a gross basis at March 31, 2014 and December 31, 2013, respectively, was as follows:

Fair Value of Derivative Instruments

March 31, 2014

December 31, 2013

Asset Derivatives

Liability Derivatives

Total

Asset Derivatives

Liability Derivatives

Total

(Millions)

Foreign exchange forward contracts

$1

$—

$1

$

—

$—

$—

Fair Value of Financial Assets on Recurring Basis

The fair value of our recurring financial assets at March 31, 2014 and December 31, 2013, respectively, are as follows:

	March 31, 2014				December 31, 2013
	Level 1	Level 2		Level 3	Level 1	Level 2		Level 3
	(Millions)
Financial Assets:
Foreign exchange forward contracts	n/a	$	1	n/a	n/a	$	—	n/a

Fair Value Hierarchy

The fair value hierarchy definition prioritizes the inputs used in measuring fair value into the following levels:

Level 1	—	Quoted prices in active markets for identical assets or liabilities.
Level 2	—	Inputs, other than quoted prices in active markets, that are observable either directly or indirectly.
Level 3	—	Unobservable inputs based on our own assumptions.

Summarization for Foreign Currency Forward Purchase and Sale Contracts

The following table summarizes by major currency the notional amounts for foreign currency forward purchase and sale contracts as of March 31, 2014 (all of which mature in 2014):

		Notional Amount in Foreign Currency
		(Millions)
Australian dollars	—Purchase	2
British pounds	—Purchase	31
	—Sell	(5	)
Canadian dollars	—Purchase	12
	—Sell	(2	)
European euro	—Purchase	8
	—Sell	(15	)
South African rand	—Purchase	222
Japanese yen	—Purchase	196
	—Sell	(461	)
Polish zloty	—Purchase	21
U.S. dollars	—Purchase	16
	—Sell	(84	)

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Common Stock (Tables)

3 Months Ended

Mar. 31, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Assumptions Used for Calculating Fair Values of Stock Option Awards

The fair value of share-based awards is determined at the time the awards are granted which is generally in January of each year, and requires judgment in estimating employee and market behavior.

	Three Months Ended March 31,
	2014			2013
Stock Options Granted
Weighted average grant date fair value, per share	$	26.46		$	19.84
Weighted average assumptions used:
Expected volatility	52.8		%	66.4		%
Expected lives	5.0			4.9
Risk-free interest rates	1.7		%	0.7		%
Dividend yields	—		%	—		%

Stock Options Status and Activity

Stock Options — The following table reflects the status and activity for all options to purchase common stock for the period indicated:

	Three Months Ended March 31, 2014
	Shares Under Option		Weighted Avg. Exercise Prices		Weighted Avg. Remaining Life in Years	Aggregate Intrinsic Value
						(Millions)
Outstanding Stock Options
Outstanding, January 1, 2014	1,983,573		$	22.93	4.5	$	62
Granted	192,624		56.23
Canceled	(31,299	)	19.78
Forfeited	(300	)	22.77
Exercised	(25,595	)	14.72			1
Outstanding, March 31, 2014	2,119,003		$	26.10	4.6	$	67

Nonvested Restricted Shares

Restricted Stock — The following table reflects the status for all nonvested restricted shares for the period indicated:

	Three Months Ended March 31, 2014
	Shares		Weighted Avg. Grant Date Fair Value
Nonvested Restricted Shares
Nonvested balance at January 1, 2014	368,268		$	34.90
Granted	131,561		54.90
Vested	(186,112	)	36.57
Forfeited	—		—
Nonvested balance at March 31, 2014	313,717		$	42.30

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Stock Options Status and Activity (Detail) (USD $) In Millions, except Share data, unless otherwise specified	3 Months Ended		12 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2012
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Employee Service Share-based Compensation, Tax Benefit Realized from Exercise of Stock Options	$ 1
Share-based Compensation, Effect on Earnings Per Share, Basic	$ 0.04	$ 0.04
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding, Beginning Balance	1,983,573
Granted		192,624
Canceled		(31,299)
Forfeited		(300)
Exercised		(25,595)
Outstanding, Ending Balance		2,119,003
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward]
Outstanding, Beginning Balance	$ 22.93
Granted		$ 56.23
Canceled		$ 19.78
Forfeited		$ 22.77
Exercised		$ 14.72
Outstanding, Ending Balance		$ 26.10
Weighted Avg. Remaining Life in Years		4 years 7 months 5 days	4 years 6 months 0 days
Aggregate Intrinsic Value, Outstanding, Beginning Balance	62
Aggregate Intrinsic Value, Exercised		1
Aggregate Intrinsic Value, Outstanding, Ending Balance		$ 67
Increase Decrease In Earnings Per Share Diluted		$ 0.03

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Restructuring and Other Charges - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended			12 Months Ended	3 Months Ended		12 Months Ended			3 Months Ended		12 Months Ended	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2012	Dec. 31, 2012	Mar. 31, 2014 Cost of Sales [Member]	Mar. 31, 2013 Cost of Sales [Member]	Dec. 31, 2012 Cost of Sales [Member]	Dec. 31, 2012 Selling, General and Administrative Expenses [Member]	Dec. 31, 2012 Facility Closing [Member]	Mar. 31, 2014 Europe [Member]	Mar. 31, 2014 Europe [Member]	Dec. 31, 2013 Europe [Member]	Mar. 31, 2014 Other Expense [Member] Europe [Member]	Mar. 31, 2014 Engineering Expense [Member] Europe [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring cost		$ 4		$ 78		$ 1	$ 70	$ 6		$ 10			$ 1	$ 1
Noncash asset write downs						3
Restructuring and related cost allowed to be excluded from the calculation of financial covenant ratios	80
Asset Impairment Charges			7
Expenses											2	60
Non- cash charges				$ 3	$ 1				$ 4

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CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Current assets:
Cash and cash equivalents	$ 267	$ 275
Restricted cash	6	5
Receivables —
Customer notes and accounts, net	1,265	1,041
Other	23	19
Inventories —
Finished goods	295	267
Work in process	233	202
Raw materials	151	130
Materials and supplies	58	57
Deferred income taxes	71	71
Prepayments and other	259	223
Total current assets	2,628	2,290
Other assets:
Long-term receivables, net	14	14
Goodwill	69	69
Intangibles, net	29	30
Deferred income taxes	117	125
Other	128	127
Total other assets	357	365
Plant, property, and equipment, at cost	3,545	3,498
Less — Accumulated depreciation and amortization	(2,351)	(2,323)
Plant, property and equipment, net	1,194	1,175
Total Assets	4,179	3,830
Current liabilities:
Short-term debt (including current maturities of long-term debt)	106	83
Trade payables	1,430	1,359
Accrued taxes	44	40
Accrued interest	14	10
Accrued liabilities	265	252
Other	95	94
Total current liabilities	1,954	1,838
Long-term debt	1,209	1,019
Deferred income taxes	29	28
Postretirement benefits	235	249
Deferred credits and other liabilities	194	204
Total liabilities	3,621	3,338
Redeemable noncontrolling interests	25	20
Tenneco Inc. Shareholders’ equity:
Common stock	1	1
Premium on common stock and other capital surplus	3,029	3,014
Accumulated other comprehensive loss	(363)	(360)
Retained earnings (accumulated deficit)	(1,875)	(1,921)
Shareholders Equity Before Deduction Of Treasury Stock, Total	792	734
Less — Shares held as treasury stock, at cost	301	301
Total Tenneco Inc. shareholders’ equity	491	433
Noncontrolling interests	42	39
Total equity	533	472
Total liabilities, redeemable noncontrolling interests and equity	$ 4,179	$ 3,830

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Long-Term Debt and Financing Arrangements

3 Months Ended

Mar. 31, 2014

Debt Disclosure [Abstract]

Long-Term Debt and Financing Arrangements

Long-Term Debt and Financing Arrangements

Our financing arrangements are primarily provided by a committed senior secured financing arrangement with a syndicate of banks and other financial institutions. The arrangement is secured by substantially all our domestic assets and pledges of up to 66 percent of the stock of certain first-tier foreign subsidiaries, as well as guarantees by our material domestic subsidiaries.

On March 22, 2012, we completed an amendment and restatement of our senior credit facility by increasing the amount and extending the maturity date of our revolving credit facility and adding a new $250 million Tranche A Term Facility. As of March 31, 2014, the senior credit facility provides us with a total revolving credit facility size of $850 million and had a $225 million balance outstanding under the Tranche A Term Facility, both of which will mature on March 22, 2017. Funds may be borrowed, repaid and re-borrowed under the revolving credit facility without premium or penalty. The revolving credit facility is reflected as debt on our balance sheet only if we borrow money under this facility or if we use the facility to make payments for letters of credit. Outstanding letters of credit reduce our availability to enter into revolving loans under the facility. We are required to make quarterly principal payments under the Tranche A Term Facility of $6.3 million beginning June 30, 2014 through March 31, 2015, $9.4 million beginning June 30, 2015 through March 31, 2016, $12.5 million beginning June 30, 2016 through December 31, 2016 and a final payment of $125 million is due on March 22, 2017. We have excluded the required payments, within the next twelve months, under the Tranche A Term Facility totaling $25 million from current liabilities as of March 31, 2014, because we have the intent and ability to refinance the obligations on a long-term basis by using our revolving credit facility.

The financial ratios required under the amended and restated senior credit facility, and the actual ratios we achieved for the first quarter of 2014, are as follows:

	Quarter Ended
	March 31, 2014
	Required	Actual
Leverage Ratio (maximum)	3.50	1.63
Interest Coverage Ratio (minimum)	2.75	10.39

The senior credit facility includes a maximum leverage ratio covenant of 3.50 and a minimum interest coverage ratio of 2.75 through March 22, 2017.

At March 31, 2014, of the $850 million available under the revolving credit facility, we had unused borrowing capacity of $562 million with $251 million in outstanding borrowings and $37 million in outstanding letters of credit. As of March 31, 2014, our outstanding debt also included $225 million related to our Tranche A Term Facility which is subject to quarterly principal payments as described above through March 22, 2017, $225 million of 7.75 percent senior notes due August 15, 2018, $500 million of 6.875 percent senior notes due December 15, 2020, and $114 million of other debt.

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Balance Sheet (Detail) (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013	Jun. 30, 2013	Mar. 31, 2013	Jun. 30, 2012
Current assets:
Cash and cash equivalents	$ 267	$ 275	$ 275	$ 233	$ 223
Restricted cash	6	5
Receivables, net	1,288	1,060
Inventories	737	656
Deferred income taxes	71	71
Prepayments and other	259	223
Total current assets	2,628	2,290
Other assets:
Investment in affiliated companies	0	0
Notes and advances receivable from affiliates	0	0
Long-term receivables, net	14	14
Goodwill	69	69
Intangibles, net	29	30
Deferred income taxes	117	125
Other	128	127
Total other assets	357	365
Plant, property, and equipment, at cost	3,545	3,498
Less — Accumulated depreciation and amortization	(2,351)	(2,323)
Plant, property and equipment, net	1,194	1,175
Total Assets	4,179	3,830		3,878
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	106	83
Short-term debt — affiliated	0	0
Trade payables	1,430	1,359
Accrued taxes	44	40
Other	374	356
Total current liabilities	1,954	1,838
Long-term debt — non-affiliated	1,209	1,019
Long-term debt — affiliated	0	0
Deferred income taxes	29	28
Postretirement benefits and other liabilities	429	453
Total liabilities	3,621	3,338
Redeemable noncontrolling interests	25	20
Tenneco Inc. shareholders’ equity	491	433
Noncontrolling interests	42	39
Total equity	533	472		334
Total liabilities, redeemable noncontrolling interests and equity	4,179	3,830
Guarantor Subsidiaries
Current assets:
Cash and cash equivalents	2	6	6	4	4
Restricted cash	0
Receivables, net	593	387
Inventories	314	279
Deferred income taxes	88	87
Prepayments and other	41	35
Total current assets	1,038	794
Other assets:
Investment in affiliated companies	926	944
Notes and advances receivable from affiliates	1,030	1,026
Long-term receivables, net	12	12
Goodwill	22	22
Intangibles, net	12	13
Deferred income taxes	61	72
Other	45	44
Total other assets	2,108	2,133
Plant, property, and equipment, at cost	1,187	1,173
Less — Accumulated depreciation and amortization	(817)	(807)
Plant, property and equipment, net	370	366
Total Assets	3,516	3,293
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	0	0
Short-term debt — affiliated	217	247
Trade payables	539	521
Accrued taxes	9	9
Other	134	128
Total current liabilities	899	905
Long-term debt — non-affiliated	0	0
Long-term debt — affiliated	1,878	1,700
Deferred income taxes	0	0
Postretirement benefits and other liabilities	339	357
Total liabilities	3,116	2,962
Redeemable noncontrolling interests	0	0
Tenneco Inc. shareholders’ equity	400	331
Noncontrolling interests	0	0
Total equity	400	331
Total liabilities, redeemable noncontrolling interests and equity	3,516	3,293
Nonguarantor Subsidiaries
Current assets:
Cash and cash equivalents	265	269	269	229	219
Restricted cash	6
Receivables, net	1,464	1,306
Inventories	423	377
Deferred income taxes	0	0
Prepayments and other	217	188
Total current assets	2,375	2,145
Other assets:
Investment in affiliated companies	0	0
Notes and advances receivable from affiliates	8,124	7,320
Long-term receivables, net	2	2
Goodwill	47	47
Intangibles, net	17	17
Deferred income taxes	9	9
Other	61	60
Total other assets	8,260	7,455
Plant, property, and equipment, at cost	2,358	2,325
Less — Accumulated depreciation and amortization	(1,534)	(1,516)
Plant, property and equipment, net	824	809
Total Assets	11,459	10,409
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	91	68
Short-term debt — affiliated	336	176
Trade payables	1,066	1,011
Accrued taxes	35	31
Other	298	285
Total current liabilities	1,826	1,571
Long-term debt — non-affiliated	7	8
Long-term debt — affiliated	8,145	7,338
Deferred income taxes	29	28
Postretirement benefits and other liabilities	86	92
Total liabilities	10,093	9,037
Redeemable noncontrolling interests	25	20
Tenneco Inc. shareholders’ equity	1,299	1,313
Noncontrolling interests	42	39
Total equity	1,341	1,352
Total liabilities, redeemable noncontrolling interests and equity	11,459	10,409
Tenneco Inc
Current assets:
Cash and cash equivalents	0	0	0	0	0
Restricted cash	0
Receivables, net	16	16
Inventories	0	0
Deferred income taxes	7	7
Prepayments and other	1	0
Total current assets	24	23
Other assets:
Investment in affiliated companies	768	696
Notes and advances receivable from affiliates	5,004	4,826
Long-term receivables, net	0	0
Goodwill	0	0
Intangibles, net	0	0
Deferred income taxes	47	44
Other	22	23
Total other assets	5,841	5,589
Plant, property, and equipment, at cost	0	0
Less — Accumulated depreciation and amortization	0	0
Plant, property and equipment, net	0	0
Total Assets	5,865	5,612
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	15	15
Short-term debt — affiliated	10	10
Trade payables	0	0
Accrued taxes	0	0
Other	13	9
Total current liabilities	38	34
Long-term debt — non-affiliated	1,202	1,011
Long-term debt — affiliated	4,135	4,134
Deferred income taxes	0	0
Postretirement benefits and other liabilities	(1)	0
Total liabilities	5,374	5,179
Redeemable noncontrolling interests	0	0
Tenneco Inc. shareholders’ equity	491	433
Noncontrolling interests	0	0
Total equity	491	433
Total liabilities, redeemable noncontrolling interests and equity	5,865	5,612
Reclass & Elims
Current assets:
Cash and cash equivalents	0	0
Restricted cash	0
Receivables, net	(785)	(649)
Inventories	0	0
Deferred income taxes	(24)	(23)
Prepayments and other	0	0
Total current assets	(809)	(672)
Other assets:
Investment in affiliated companies	(1,694)	(1,640)
Notes and advances receivable from affiliates	(14,158)	(13,172)
Long-term receivables, net	0	0
Goodwill	0	0
Intangibles, net	0	0
Deferred income taxes	0	0
Other	0	0
Total other assets	(15,852)	(14,812)
Plant, property, and equipment, at cost	0	0
Less — Accumulated depreciation and amortization	0	0
Plant, property and equipment, net	0	0
Total Assets	(16,661)	(15,484)
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	0	0
Short-term debt — affiliated	(563)	(433)
Trade payables	(175)	(173)
Accrued taxes	0	0
Other	(71)	(66)
Total current liabilities	(809)	(672)
Long-term debt — non-affiliated	0	0
Long-term debt — affiliated	(14,158)	(13,172)
Deferred income taxes	0	0
Postretirement benefits and other liabilities	5	4
Total liabilities	(14,962)	(13,840)
Redeemable noncontrolling interests	0	0
Tenneco Inc. shareholders’ equity	(1,699)	(1,644)
Noncontrolling interests	0	0
Total equity	(1,699)	(1,644)
Total liabilities, redeemable noncontrolling interests and equity	$ (16,661)	$ (15,484)

XML

Pension Plans, Postretirement and Other Employee Benefits (Tables)

3 Months Ended

Mar. 31, 2014

Compensation and Retirement Disclosure [Abstract]

Components of Net Periodic Benefit Cost

Net periodic pension costs and postretirement benefit costs consist of the following components:

	Three Months Ended March 31,
	Pension												Postretirement
	2014						2013						2014			2013
	US			Foreign			US			Foreign			US			US
	(Millions)
Service cost — benefits earned during the period	$	—		$	2		$	—		$	2		$	—		$	—
Interest cost	5			5			5			4			1			1
Expected return on plan assets	(6		)	(6		)	(5		)	(5		)	—			—
Net amortization:
Actuarial loss	2			2			2			3			1			1
Prior service cost (credit)	—			—			—			—			(2		)	(1		)
Net pension and postretirement costs	$	1		$	3		$	2		$	4		$	—		$	1

For

Amounts Recognized for Pension and Postretirement Benefits in Other Comprehensive Income

Amounts recognized for pension and postretirement benefits in other comprehensive income for the three periods ended March 31, 2014 and 2013 include the following components:

	Three Months Ended March 31,
	2014							2013
	Before-Tax Amount		Tax Benefit			Net-of-Tax Amount		Before- Tax Amount			Tax Benefit			Net-of-Tax Amount
	(Millions)
Defined benefit pension and postretirement plans:
Amortization of prior service cost included in net periodic pension and postretirement cost	$	—	$	—		$	—	$	(1	)	$	—		$	(1	)
Amortization of actuarial loss included in net periodic pension and postretirement cost	4		(1		)	3		6			(1		)	5
Other comprehensive income – pension benefits	$	4	$	(1	)	$	3	$	5		$	(1	)	$	4

XML

Financial Ratios under Senior Credit Facility (Detail) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014
Required [Member]
Financial Ratios Under Senior Credit Facility [Line Items]
Leverage Ratio (maximum)	3.5
Interest Coverage Ratio (minimum)	2.75
Actual [Member]
Financial Ratios Under Senior Credit Facility [Line Items]
Leverage Ratio (maximum)	1.63
Interest Coverage Ratio (minimum)	10.39
Tranche Term Facility [Member]
Financial Ratios Under Senior Credit Facility [Line Items]
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months	$ 25

XML

Supplemental Guarantor Condensed Consolidating Financial Statements

3 Months Ended

Mar. 31, 2014

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Supplemental Guarantor Condensed Consolidating Financial Statements

Supplemental Guarantor Condensed Consolidating Financial Statements

Basis of Presentation

Substantially all of our existing and future material domestic 100% owned subsidiaries (which are referred to as the Guarantor Subsidiaries) fully and unconditionally guarantee our senior notes due in 2018 and 2020 on a joint and several basis. However, a subsidiary’s guarantee may be released in certain customary circumstances such as a sale of the subsidiary or all or substantially all of its assets in accordance with the indenture applicable to the notes. The Guarantor Subsidiaries are combined in the presentation below.

These consolidating financial statements are presented on the equity method. Under this method, our investments are recorded at cost and adjusted for our ownership share of a subsidiary’s cumulative results of operations, capital contributions and distributions, and other equity changes. You should read the condensed consolidating financial information of the Guarantor Subsidiaries in connection with our condensed consolidated financial statements and related notes of which this note is an integral part.

Distributions

There are no significant restrictions on the ability of the Guarantor Subsidiaries to make distributions to us.

STATEMENT OF COMPREHENSIVE INCOME (LOSS)

	For the Three Months Ended March 31, 2014
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims			Consolidated
	(Millions)
Revenues
Net sales and operating revenues —
External	$	920		$	1,174		$	—		$	—		$	2,094
Affiliated companies	103			148			—			(251		)	—
	1,023			1,322			—			(251		)	2,094
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	802			1,203			—			(251		)	1,754
Engineering, research, and development	22			20			—			—			42
Selling, general, and administrative	51			79			2			—			132
Depreciation and amortization of other intangibles	21			30			—			—			51
	896			1,332			2			(251		)	1,979
Other income (expense)
Loss on sale of receivables	—			(1		)	—			—			(1		)
Other income (loss)	(2		)	1			—			—			(1		)
	(2		)	—			—			—			(2		)
Earnings (loss) before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies	125			(10		)	(2		)	—			113
Interest expense —
External (net of interest capitalized)	—			—			19			—			19
Affiliated companies (net of interest income)	16			(16		)	—			—			—
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies	109			6			(21		)	—			94
Income tax expense	30			10									40
Equity in net income (loss) from affiliated companies	(15		)	—			67			(52		)	—
Net Income (loss)	64			(4		)	46			(52		)	54
Less: Net income attributable to noncontrolling interests	—			8			—			—			8
Net income (loss) attributable to Tenneco Inc.	$	64		$	(12	)	$	46		$	(52	)	$	46
Comprehensive income (loss) attributable to Tenneco Inc.	$	65		$	(16	)	$	46		$	(52	)	$	43

STATEMENT OF COMPREHENSIVE INCOME (LOSS)

	For the Three Months Ended March 31, 2013
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims			Consolidated
	(Millions)
Revenues
Net sales and operating revenues —
External	$	852		$	1,051		$	—		$	—		$	1,903
Affiliated companies	79			150			—			(229		)	—
	931			1,201			—			(229		)	1,903
Costs and expenses
Cost of sales (exclusive of depreciation and amortization shown below)	742			1,091			—			(229		)	1,604
Engineering, research, and development	15			20			—			—			35
Selling, general, and administrative	53			64			2			—			119
Depreciation and amortization of other intangibles	19			31			—			—			50
	829			1,206			2			(229		)	1,808
Other income (expense)
Loss on sale of receivables	—			(1		)	—			—			(1		)
Other income (expense)	(1		)	—			—			—			(1		)
	(1		)	(1		)	—			—			(2		)
Earnings before interest expense, income taxes, noncontrolling interests, and equity in net income from affiliated companies	101			(6		)	(2		)	—			93
Interest expense —
External (net of interest capitalized)	—			1			19			—			20
Affiliated companies (net of interest income)	18			(19		)	1			—			—
Earnings (loss) before income taxes, noncontrolling interests, and equity in net income from affiliated companies	83			12			(22		)	—			73
Income tax expense	6			6			—			—			12
Equity in net income (loss) from affiliated companies	(5		)	—			76			(71		)	—
Net income (loss)	72			6			54			(71		)	61
Less: Net income attributable to noncontrolling interests	—			7			—			—			7
Net income (loss) attributable to Tenneco Inc.	$	72		$	(1	)	$	54		$	(71	)	$	54
Comprehensive income (loss) attributable to Tenneco Inc.	$	67		$	(18	)	$	54		$	(71	)	$	32

BALANCE SHEET

	March 31, 2014
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims			Consolidated
	(Millions)
ASSETS
Current assets:
Cash and cash equivalents	$	2		$	265		$	—		$	—		$	267
Restricted cash	—			6			—			—			6
Receivables, net	593			1,464			16			(785		)	1,288
Inventories	314			423			—			—			737
Deferred income taxes	88			—			7			(24		)	71
Prepayments and other	41			217			1			—			259
Total current assets	1,038			2,375			24			(809		)	2,628
Other assets:
Investment in affiliated companies	926			—			768			(1,694		)	—
Notes and advances receivable from affiliates	1,030			8,124			5,004			(14,158		)	—
Long-term receivables, net	12			2			—			—			14
Goodwill	22			47			—			—			69
Intangibles, net	12			17			—			—			29
Deferred income taxes	61			9			47			—			117
Other	45			61			22			—			128
	2,108			8,260			5,841			(15,852		)	357
Plant, property, and equipment, at cost	1,187			2,358			—			—			3,545
Less — Accumulated depreciation and amortization	(817		)	(1,534		)	—			—			(2,351		)
	370			824			—			—			1,194
Total assets	$	3,516		$	11,459		$	5,865		$	(16,661	)	$	4,179
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	$	—		$	91		$	15		$	—		$	106
Short-term debt — affiliated	217			336			10			(563		)	—
Trade payables	539			1,066			—			(175		)	1,430
Accrued taxes	9			35			—			—			44
Other	134			298			13			(71		)	374
Total current liabilities	899			1,826			38			(809		)	1,954
Long-term debt — non-affiliated	—			7			1,202			—			1,209
Long-term debt — affiliated	1,878			8,145			4,135			(14,158		)	—
Deferred income taxes	—			29			—			—			29
Postretirement benefits and other liabilities	339			86			(1		)	5			429
Commitments and contingencies
Total liabilities	3,116			10,093			5,374			(14,962		)	3,621
Redeemable noncontrolling interests	—			25			—			—			25
Tenneco Inc. shareholders’ equity	400			1,299			491			(1,699		)	491
Noncontrolling interests	—			42			—			—			42
Total equity	400			1,341			491			(1,699		)	533
Total liabilities, redeemable noncontrolling interests and equity	$	3,516		$	11,459		$	5,865		$	(16,661	)	$	4,179

BALANCE SHEET

	December 31, 2013
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)		Reclass & Elims			Consolidated
	(Millions)
ASSETS
Current assets:
Cash and cash equivalents	$	6		$	269		$	—	$	—		$	275
Restricted cash	—			5			—		—			5
Receivables, net	387			1,306			16		(649		)	1,060
Inventories	279			377			—		—			656
Deferred income taxes	87			—			7		(23		)	71
Prepayments and other	35			188			—		—			223
Total current assets	794			2,145			23		(672		)	2,290
Other assets:
Investment in affiliated companies	944			—			696		(1,640		)	—
Notes and advances receivable from affiliates	1,026			7,320			4,826		(13,172		)	—
Long-term receivables, net	12			2			—		—			14
Goodwill	22			47			—		—			69
Intangibles, net	13			17			—		—			30
Deferred income taxes	72			9			44		—			125
Other	44			60			23		—			127
	2,133			7,455			5,589		(14,812		)	365
Plant, property, and equipment, at cost	1,173			2,325			—		—			3,498
Less — Accumulated depreciation and amortization	(807		)	(1,516		)	—		—			(2,323		)
	366			809			—		—			1,175
Total assets	$	3,293		$	10,409		$	5,612	$	(15,484	)	$	3,830
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term debt (including current maturities of long-term debt)
Short-term debt — non-affiliated	$	—		$	68		$	15	$	—		$	83
Short-term debt — affiliated	247			176			10		(433		)	—
Trade payables	521			1,011			—		(173		)	1,359
Accrued taxes	9			31			—		—			40
Other	128			285			9		(66		)	356
Total current liabilities	905			1,571			34		(672		)	1,838
Long-term debt — non-affiliated	—			8			1,011		—			1,019
Long-term debt — affiliated	1,700			7,338			4,134		(13,172		)	—
Deferred income taxes	—			28			—		—			28
Postretirement benefits and other liabilities	357			92			—		4			453
Commitments and contingencies
Total liabilities	2,962			9,037			5,179		(13,840		)	3,338
Redeemable noncontrolling interests	—			20			—		—			20
Tenneco Inc. shareholders’ equity	331			1,313			433		(1,644		)	433
Noncontrolling interests	—			39			—		—			39
Total equity	331			1,352			433		(1,644		)	472
Total liabilities, redeemable noncontrolling interests and equity	$	3,293		$	10,409		$	5,612	$	(15,484	)	$	3,830

STATEMENT OF CASH FLOWS

	Three Months Ended March 31, 2014
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims		Consolidated
	(Millions)
Operating Activities
Net cash provided (used) by operating activities	$	(208	)	$	90		$	(22	)	$	—	$	(140	)
Investing Activities
Cash payments for plant, property, and equipment	(25		)	(58		)	—			—		(83		)
Cash payments for software related intangible assets	(4		)	(3		)	—			—		(7		)
Changes in restricted cash	—			(1		)	—			—		(1		)
Net cash used by investing activities	(29		)	(62		)	—			—		(91		)
Financing Activities
Issuance (repurchase) of common shares	—			—			(2		)	—		(2		)
Tax benefit from stock-based compensation	—			—			12			—		12
Retirement of long-term debt	—			—			(3		)	—		(3		)
Increase (decrease) in bank overdrafts	—			4						—		4
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt and short-term borrowings secured by accounts receivables	—			24			173			—		197
Net increase (decrease) in short-term borrowings secured by accounts receivables	—			—			20			—		20
Intercompany dividends and net increase (decrease) in intercompany obligations	233			(55		)	(178		)	—		—
Capital contribution from noncontrolling interest partners	—			1			—			—		1
Net cash provided (used) by financing activities	233			(26		)	22			—		229
Effect of foreign exchange rate changes on cash and cash equivalents	—			(6		)	—			—		(6		)
Increase (decrease) in cash and cash equivalents	(4		)	(4		)	—			—		(8		)
Cash and cash equivalents, January 1	6			269			—			—		275
Cash and cash equivalents, March 31 (Note)	$	2		$	265		$	—		$	—	$	267

Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase.

STATEMENT OF CASH FLOWS

	Three Months Ended March 31, 2013
	Guarantor Subsidiaries			Nonguarantor Subsidiaries			Tenneco Inc. (Parent Company)			Reclass & Elims		Consolidated
	(Millions)
Operating Activities
Net cash provided (used) by operating activities	$	(102	)	$	15		$	(5	)	$	—	$	(92	)
Investing Activities
Proceeds from sale of assets	—			2			—			—		2
Cash payments for plant, property, and equipment	(32		)	(38		)	—			—		(70		)
Cash payments for software related intangible assets	(3		)	(3		)	—			—		(6		)
Changes in restricted cash	—			(9		)						(9		)
Net cash used by investing activities	(35		)	(48		)	—			—		(83		)
Financing Activities
Issuance of common shares	—			—			1			—		1
Retirement of long-term debt	—			—			(5		)	—		(5		)
Increase (decrease) in bank overdrafts	—			(9		)	—			—		(9		)
Net increase (decrease) in revolver borrowings and short-term debt excluding current maturities of long-term debt	—			3			188			—		191
Intercompany dividends and net increase (decrease) in intercompany obligations	137			42			(179		)	—		—
Net cash provided by financing activities	137			36			5			—		178
Effect of foreign exchange rate changes on cash and cash equivalents	—			7			—			—		7
Increase (decrease) in cash and cash equivalents	—			10			—			—		10
Cash and cash equivalents, January 1	4			219			—			—		223
Cash and cash equivalents, March 31 (Note)	$	4		$	229		$	—		$	—	$	233

Note: Cash and cash equivalents include highly liquid investments with a maturity of three months or less at the date of purchase.